Lower Oil Price Forces The Nigerian Naira To Sink All Time Low Against The Dollar

Nigeria’s Naira sank to its lowest intraday level in almost five-years of 171.65 as the Nigerian Central Bank moved to curb excess dollar demand at its foreign exchange auctions, instead shifting demand to the interbank market, amid tight supply, dealers said.

The Naira slide followed CBN’s ban on the sale of dollars to importers of telecom equipment, power generators and finished products at its foreign exchange auction, instead shifting demand to the interbank market.

The central bank also restricted lenders and discount houses from placing more than 7.5 billion naira ($44 mln) each as deposits with the regulator, swelling interbank Naira liquidity.

Meanwhile, in the Stock market, the slide continues unabated. The major companies depreciated further, with Nestle leading the train with N47.5 Naira loss, to close at N883. Forte Oil slumped from N208 to N194 and Dangote Cement, the biggest stock in the market lost N10.4 Naira and closed the day at N198. WAPCO is now selling for N80, its lowest price in four years. It lost N8.73 kobo. Nigeria Breweries also scaled down to N143.45 having lost N7.55.

Unilever closed at N29.80, slipping down from N31.35 level yesterday. Market capitalisation sank to N11.425 trillion, losing N475 billion. It was N12.17 trillion on Tuesday and N11.9 trillion Wednesday.

Nothing better reflects the bearish panic in the market than the volume of transactions: 1.3 billion shares sold for N8.3 billion.