Naira Plummets to N1,486 per Dollar at Official Market

The naira experienced a significant drop yesterday, depreciating by 1.58% to close at N1,485.66 per dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM). This decline follows the currency’s stronger start earlier in the week at N1,468 per dollar, an improvement from the previous rate of N1,497 per dollar recorded on Friday, May 17, 2024.

During the trading session, the naira fluctuated between an intra-day high of N1,550 per dollar and a low of N1,400 per dollar, demonstrating a tight spread of N150 per dollar. Meanwhile, in the parallel market, the naira closed at N1,505 per dollar.

The Central Bank of Nigeria (CBN) recently mandated that all authorized dealers must process Personal and Business Travel Allowances (PTA/BTA) electronically, through debit or credit cards, instead of cash. This directive aims to enhance transparency and stability in the foreign exchange market and curb malpractices.

“In line with the Bank’s commitment to ensure transparency and stability in the foreign exchange market and avoid foreign exchange malpractices, all authorized dealer banks shall henceforth effect payout of PTA/BTA through electronic channels only, including debit or credit cards. For the avoidance of doubt, payment of PTA/BTA by cash is no longer permitted,” the CBN stated.

Importers and small businesses are increasingly struggling to obtain necessary foreign exchange from both the official and black markets. The demand is driven by legitimate needs such as applications for Business Travel Allowance (BTA), Personal Travel Allowance (PTA), school fees, and medical expenses, with Small and Medium Enterprises (SMEs) facing similar challenges under Form Q applications.