ABUJA (Reuters) – Nigeria’s central bank sold the dollar for 645 naira in the latest auction announced on Friday, lower than the 465 naira for the dollar traded on the official secondary market, the results showed. rice field.
Nigeria operates multiple exchange rates, which the central bank has used to manage demand, mask pressure on the naira and preserve dwindling foreign exchange reserves. The system has fueled a black market, trading significantly below the spot rate.
The bank held its most recent bi-weekly auction on May 26 and conducted a dollar bid at Naira 630 in April.
The naira has fallen faster in the central bank auction than in the spot market, and many analysts believe the devaluation could match the trading rate in the auction.
On Thursday, the central bank condemned news of the currency devaluation after media reported that the naira had fallen sharply in value following speculation over the outcome of talks between new president Bola Tinub and the central bank governor this week. The naira has already fallen at auction.
Prime Minister Tinub told the governor of Abuja’s ruling All Progressive Congress on Friday that the country’s multiple exchange rates would be streamlined. “We will not introduce multiple exchange rates in the future,” he said.
The central bank is gradually adjusting the naira’s value in the spot market to avoid a large-scale devaluation. Former president Muhammadu Buhari, who ruled for eight years, saw the currency appreciation as a matter of national pride.
Reported by Chijioke Ohuocha.Editing: Chris Reese and David Holmes
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