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The USD has soared above the Nigerian naira to be at 420/dollar in the black market this Tuesday. The last time naira fell in a similar manner, was in 2017. In the forex spot market Tuesday, the official Naira rate has also fallen following the adjustment by CBN, but not to the same extent as the black market rate.
The official forex market rate now stands at around 388 Naira, which means the spread between the black market and official rates has widened to 14%.
More so, the naira faces more than one crises during the pandemic. Trading doors for the USD Naira exchange is unstable and foreign traders seek to get their hands on the USD with little success.
Both big and small economic contributing sectors in Nigeria have been halted and the oil price crash is also doing its damage on the Naira.
For the last two days, the U.S. crude traded at below zero and global benchmark Brent crude fell with it. Being benchmarked to Brent, Nigerian oil is now trading at a discount, which could hurt public spending and its dollar earnings.
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