The naira plunged to a new all-time low of N520 to the dollar at the parallel market on Monday, posting its biggest weekly decline so far in the recent times.

The local currency stood at 517 per dollar at the close of trading on Friday, down from 507 against the greenback on Thursday at the parallel market.

A week ago, the local currency was exchanged at 505 but dropped five points on Friday to close at 510 and eventually hit a record low of 517 when the foreign exchange market closed for the week.

On Monday, a parallel market dealer on Allen Avenue, Ikeja Lagos, told our reporter that he bought the dollar at N517 per dollar and had to sell at N520 to earn some margin.

The naira at the official forex market stood at 305.50 to the dollar, but exchanged at 379.28 per pound, indicating a slight appreciation of 2.56 and closed at 325.30 per Euro which showed a decline of 0.43 while compared to the previous day rate of 324.87.

At the interbank market, the naira closed flat Friday at 315.12 per dollar, 391.22 to a pound sterling and 335.51 against the Euro, respectively.

The naira at the Moneygram platform receiving rate on Friday closed at N373.13 to the greenback, but traded at 465.02 to a pound and N397.30 against the Euro. At the Western Union, it was 375.00 to the dollar, 455.85 per pound and 391.20 against the Euro.

Meanwhile, the banking system’s overnight lending rate doubled to 25 percent on Friday from 10.17 percent on Thursday after the Central Bank of Nigeria (CBN) sold open market bills and debited commercial banks for bond purchases.

According to the traders, the CBN sold N178.44bn ($586.01m) in 321-day treasury bills at 18.6 per cent and N19.14bn of 174-day paper at 18 per cent, draining cash from the money market and pushing up the cost of borrowing among commercial lenders.

It also debited commercial banks’ accounts for the purchases of N160bn worth of long tenor bonds and N202.4bn in treasury bills sold at auctions on Wednesday, leaving the market with little cash for transactions.

However, the nations’ foreign exchange reserves climbed to $29bn as of February 15, their highest level in 19 months, the CBN data showed on Friday.

The external reserves have increased by 11.2 per cent this year but are still far off their peak of $64bn hit about nine years ago.

It would be recalled that, the Debt Management Office and the CBN had raised N160bn in local currency bonds at its second debt auction this year and N202.4bn treasury bills at another auction, respectively same Wednesday.

On Thursday, the money market had a cash surplus of about N83.89bn compared with N55.07bn a week ago. However, about N120bn in treasury bills is expected to mature and repaid next week.

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