The naira fell from 225 to 232 against the dollar at the parallel market on Friday, one week after the Central Bank of Nigeria introduced a new rule into the foreign exchange market.
The local currency had recorded 225 against the greenback at the black market upper Friday.
The CBN has directed Bureau de Change operators to demand details of the Bank Verification Number of prospective forex buyers before selling dollars to them effective November 1, 2015.
Currency experts and stakeholders said the development would the naira to depreciate further on the parallel market this week.
However, the naira has been trading between 197 and 198 on the interbank market in the last one week.
“Most customers are not comfortable giving out their BVN before purchasing dollars from us and therefore preferred to patronise black market for dollars, pushing down the value of the naira,” the President, Association of Bureau De Change Operators, Mr. Aminu Gwadabe, said.
The BVN is meant to verify the identity of bank’s customer and reduce fraud.
Meanwhile, the cedi is expected to remain stable this week on consistent central bank dollar supplies to match market demands, Reuters has reported quoting analysts.
The cedi rebounded in July after slumping nearly 30 per cent in the first half of the year. It rallied to 3.6700 last week, compared with 3.8000 a week ago, Thomson Reuters data showed.
“For the past few weeks, it’s been good. There’s been regular supply of dollars on the market and the cedi is expected to remain stable in the weeks ahead as well,” said Joseph Amponsah of Dortis Research in Accra.
The Kenyan shilling is seen as vulnerable in this week following a sharp fall in government debt yields, while Zambia’s kwacha is expected to remain on the back foot as the price of its major export, copper, remains low.
The shilling is seen weakening in this week, with the local currency seen vulnerable to further losses due to loosening liquidity following a sharp fall in government debt yields.
Commercial banks quoted the shilling at 102.15/25 to the dollar, compared with previous week’s close of 101.80/90.
“T-bill yields are the driver in the market,” said one Nairobi-based trader.
But in auctions last week, the yield on the 182-day bill fell to 16.492 per cent from 21.028 per cent a two weeks ago, while the yield on the 364-day bill dropped to 17.130 per cent from 21.212 per cent.
The yield on the 91-day bill plummeted to 13.763 per cent, compared to 19.471 per cent at the previous week’s sale.
The kwacha is expected to remain on the back foot against the dollar this week as the price of its major export, copper remains low and due to risk aversion by investors as the US prepares to possibly hike interest rates.
Commercial banks quoted the currency of Africa’s No.2 copper producer at 12.6700 per dollar last week, weaker than a close of 12.5700 two weeks ago.