ABUJA- Nigeria's currency fell 3.3% to hit a record low of 522 naira against the dollar on the black market on Wednesday, after the central bank banned sales of foreign currency to exchange bureaux, traders said.
The currency was quoted at 505 naira on the unofficial market before Tuesday's announcement. The central bank has said the bureaux have become conduits for graft and illicit flows of money.
Central bank governor Godwin Emefiele said the bank would channel more foreign exchange to commercial banks for consumers who had legitimate needs, and that it would no longer process or issue new licences for operators of bureaux de change.
"We see the announcement negative for the naira in the parallel market," analysts at Stanbic IBTC wrote in a note.
In 2016, the central bank banned sale of foreign currency to exchange bureaux to avoid depleting Nigeria's reserves after a sharp drop in oil prices. The move triggered a fall in the currency on the parallel market.
The bank devalued the naira on the official market in May, for the third time since the coronavirus pandemic took hold early last year, and has limited access to dollars for imports. But a wide gap between the official naira exchange rate and the parallel market has persisted.
The naira opened at 407.50 to the dollar on the official spot market.
(Reporting by Chijioke Ohuocha Editing by Kevin Liffey) ((chijioke.ohuocha@thomsonreuters.com; +234 703 4180 621; Reuters Messaging: chijioke.ohuocha.thomsonreuters@reuters.net))
