Nigeria’s naira on Thursday rose to N410 to a U.S dollar at the black market, after the global pandemic of Coronavirus downed oil price to below $35 a barrel.
Foreign exchange users are buying up the dollar to hedge against potential devaluation of the naira as the price of oil has slumped below $34 per barrel.
Investigations show that dollar was quoted at N410/$ at Apapa, Lagos, while in Festac area of the State, it closed at N400/$.
In the long term the naira depreciates against the US dollar in line with the difference in inflation between the two currencies. Trying to stop the naira from depreciating has proven a forlorn activity, according to Coronation Merchant Bank Limited.
The bank believes that the Central Bank of Nigeria (CBN) would keep the exchange rate at close to N362.50/$ for most, if not all, of 2020. But the effect the bank said would to add pressure on the naira as its fair value slips against the US dollar.