The exchange rate between the naira and the US dollar reached a record low for the Nigerian currency as it traded at N527/$ on Monday.
While the Naira appreciated against the US dollar to close at N411.63/$1 on Monday, it however depreciated at the parallel market as it closed at N527/$1 on Monday, 30th August 2021, representing a N3 drop when compared to N524/$1 recorded on the previous trading day.
This development comes as the CBN banned microfinance banks from foreign exchange transactions as dollar supply drops significantly by 62%.
According to Reuters, the stoppage of forex allocation to BDC operators by the CBN has drained liquidity in the black market and could further weaken the naira.
Meanwhile, Nigeria’s foreign reserve rose by $91 million as it recorded its third increase in over 2 weeks to close at $33.662 billion on Friday, 27th August 2021, compared to $33.571 billion recorded as of the previous day. The latest increase represents a 0.27% boost in the country’s foreign reserve.