The Central Bank of Nigeria (CBN) estimates that there will be a convergence of the exchange rate despite the decline in the black market.
CBN Monetary Policy Director Hassan Mahmud said at a virtual investor conference on Tuesday.
“The spot rate is the benchmark rate and I expect some Nigerian exchange rates to converge, a spread that has disappointed investors.”
Mahmud said the central bank was concerned about the currency supply and confidence in the system while adding that the naira levels would have to adjust according to demand.
According to him, market failures led the CBN to adopt a managed float regime.
This statement comes after the naira hit a low of 532 N / 1 dollar in the unofficial or black market on Monday, with the dollar being hard-earned following recent CBN actions to collect aspiring demand from the informal market, where the naira is trading at much lower levels.
Naira’s trend is bearish and with the demand for imported goods increasing, most analysts believe the rate will fall further.
Alleluia is the Assistant Editor and Content Writer at LagosPost.ng. She is a prolific writer and editor, she has written features and news stories on Lifestyle, Sports, Business, Politics and B2B marketing. She is also an event coordinator, host and social media content creator.
