The naira weakened at the Investors and Exporters’ (I&E) window on Friday closing at N410.25 per dollar compared with N408.67/$1 on Thursday, data obtained from the FMDQ website shows.
In recent weeks, the naira has been weakening against the dollar at the I&E window, dropping to a record low of N410 per dollar in that segment of the forex market compared with N394/$1 in December.
However, on December 31, last year, the naira had closed at N410.25 at the I&E window triggering speculation that the CBN had devalued the local currency. CBN Governor, Mr. Godwin Emefiele, said last year that the apex bank will pursue exchange rate unification around the I&E window rate. In a recent report, analysts at FBNQuest forecast an average I&E/NAFEX rate of N419 per dollar at the end of this year.
The analysts said that although they expected a combi- nation of higher oil revenue, multilateral loans and Eurobond sales should underpin reserves this year and allow the Central Bank of Nigeria (CBN) to contain naira exchange-rate depreciation, the forecast for average I&E/ NAFEX rate is N419 per USD at end-2021.
The naira was under pressure on the parallel market for most part of 2020 due to foreign exchange scarcity, occasioned by the slump in the price of oil( the commodity that accounts for about 90 per cent of Nigeria’s export earnings).
According to data obtained from abokifx.com, the naira traded weaker against the dollar on the parallel market on Friday, closing at N482/$1 compared with N480 per dollar on the previous day.
A recent Bloomberg survey showed that investors and analysts expect that the CBN will probably devalue the naira by as much as 10per cent this year. Specifically, Bloomberg reported that of the 17 survey participants, eight forecast a devaluation of between five per cent and 10 per cent this year.
Five saw a devaluation of more than 10 per cent and the remaining four predicted a markdown of as much as five per cent. The median of analysts’ estimates project the naira at 426.5 per dollar by the end of 2021.