The exchange rate between the naira and dollar on the black market is expected to hit N1000/$1 by the end of the year. This is according to black market operators who shared their views on their projection for the value of the naira on the back of the rapid depreciation that has ensued in the last few weeks.
Nairametrics spoke to some operators who preferred not to be named in this story for fear of being victimized for airing their views. They mostly opine the daily pace of depreciation of the naira could likely lead to the much-feared N1000 to the dollar by the end of the year.
Several media reports on Sunday suggest the exchange rate traded at about N800/$1 even though checks by Nairametrics suggest some black market operators still sold at between N775 and N790/41. The P2P market still traded at about N782.9 to the dollar on Sunday, October 30th.
Downward spiral – The exchange rate opened the year at about N565 to the dollar and depreciated to N615/$ by end of June or N50 depreciation in 6 months.
- However, since July it has depreciated from N615 to about N775 or N165 weakening in just about 4 months.
- According to Nairametrics records, the exchange rate crossed the N700 mark on the second of September and has declined rapidly since then. It ended September at about N735/$1.
- If it ends October at N800, then the month will likely go down as one of the worst months of depreciation in history for the black market, considering that the currency is depreciating by a whopping NN65/$1.
Third quarter demand Pressure: The reason for the drastic fall in the exchange rate in the third quarter of the year are multi-fold but can be summarized into three areas.
