The naira weakened to N1,410 per dollar in the parallel market, popularly known as the black market, on Monday as renewed demand for foreign exchange outweighed the positive sentiment from Nigeria’s rising external reserves.
The local currency depreciated by N13 week-on-week from N1,397 per dollar quoted on Monday last week, even as it lost N2 compared with N1,408 traded on Friday.
Currency traders attributed the renewed pressure on the naira in the parallel market to increased demand from end users sourcing foreign exchange ahead of the summer holiday season.
“The demand for dollars has picked up slightly as people prepare for summer travel,” one trader told BusinessDay on Monday.
The weakness in the parallel market contrasts with the official foreign exchange (FX) market, where the naira rebounded last week after recovering from the previous week’s losses amid improving liquidity and stronger external reserves.
