The United States dollar sold for N450 in the parallel market on Friday, showing a shallow and dry reflection of the foreign exchange market.
Impact of the crude oil prices, which had been fluctuating, and fell to as low as $21, had also been taking its toll on the strength of the naira.
The President, Association of Bureau De Change Operators of Nigeria, Alhaji Aminu Gwadabe, told The PUNCH the N450/$ rate that closed the week (Friday) was a reflection of the shallowness and dryness of the foreign exchange market.
He said this was coupled with the impact of trading on the FMDQ market on future derivatives and the negative territory of our crude oil prices.
He said, “The crash of naira rate in the parallel market to a high of N450/$ (Friday) was as result of the shallowness and dryness of the market.
“It is our resolve to enhance liquidity in the foreign exchange market and help discover a true market exchange rate that is devoid of speculative and hoarding activities.”
The ABCON President said there was the need for the regulators to think outside the box in enhancing liquidity in the market.
“There should be both demand and supply measures to navigate the stormy waters ahead,” he said.
Following the lockdown in some states, the Central Bank of Nigeria had suspended sales of dollars to the Bureau De Change operators, following a request by ABCON to the CBN to grant it market holidays, given the ongoing challenges faced in local and global economies from the coronavirus pandemic.
Gwadabe said the operators were preparing to return to the market after the regulator lifts suspension on forex.
He said, “ABCON in preparedness to our return to business has digitised the ticketing systems of our members in various collections centre nationwide in an anticipation of the lifting of restrictions on internal movements next week.
“First our return to trading will eliminate the volatility in the market and ensure stability in the market in the face of daunting challenges of COVID-19 and tumbling oil prices.”