Nigeria's naira hit a record low on the black market on Tuesday of 1,000 to the dollar, traders said, with unmet foreign-currency demand on the official market and speculation adding to downward pressure.
The black-market naira rate was trading at a nearly 30% premium over the official exchange rate, according to quotes on abokiFX, a firm that publishes online black market exchange rates. The official selling rate stood at 781 to the dollar. . Last week, the black-market rate reached 980 to the dollar.
Africa's largest economy and top oil producer has struggled to get to grips with huge dollar shortages and a myriad of exchange rates that have stymied much-needed investment in the country.
"Rampant FX shortages and a plunging parallel exchange rate are the latest signs of trouble," said Patrick Curran at Tellimer. "Decisive monetary tightening and FX float are needed but a leadership vacuum at the CBN (Central Bank of Nigeria) has hampered policy response."
Olayemi Cardoso, recently nominated by Nigeria's President Bola Tinubu to become the country's next central bank governor, was appearing before the Nigerian senate for his official confirmation hearing on Tuesday.
Cardoso's appointment is one of a number of changes President Bola Tinubu has undertaken as part of an ambitious reform track since taking office in May.
The central bank has not intervened by selling dollars on the official market for three weeks, one trader said, helping to accelerate the currency's slide on the parallel market as excess foreign-currency demand has been funnelled there.
One of the key challenges for the new central bank governor will be to boost dollar liquidity to help stabilise the currency.
(Reporting by Elisha Bala-Gbogbo, graphic by Libby George, writing by Karin Strohecker, editing by Alexander Winning and Christina Fincher)