(Bloomberg) -- The Nigerian naira extended its slide and hurtled toward the 1000-per-dollar mark in street trading, as the central bank held back from supplying dollars to a panic-stricken market.

Traders in Abuja quoted the dollar at 998 naira on Thursday, according Yahaya Adamu, a currency dealer in Wuse, a suburb of the nation’s capital,  In the commercial hub Lagos, the greenback is changing hands around 990, according to Umar Salisu, a foreign-exchange operator who compiles the data in Lagos.

“Dollar is so scarce now that as I speak to you, you cannot find $1000 to buy,” Adamu said. 

The currency’s parallel-market rate is now about 29% weaker than the official exchange rate, where the naira closed Wednesday at 770.71 per dollar on the FMDQ OTC trading platform. The two rates had briefly converged soon after the country’s newly elected president Bola Tinubu announced sweeping currency reforms in June, but they have diverged steadily since then as dollar supply from the central bank fell short. 

The central bank has mostly been on the sidelines this month, according to market players, with one person saying it has barely supplied dollars to the official window. That has helped accelerate the naira’s slide, pushing it down from around 900 per dollar at the start of September. 

The central bank did not immediately respond to requests for comment.  

Meanwhile, companies seeking hard currency to pay for imports have been joined in dollar buying by ordinary citizens who are fearful of further depreciation in the naira.

“The demand for foreign exchange is currently a stampede,” said Ogho Okiti, chief executive of ThinkBusiness Africa, a Lagos-based advisory and data services firm. “The demand is now not just for imports, but also for store and preservation of value.” 

On Thursday, the central bank postponed a rate-setting meeting scheduled for Sept 25-26. Its new governor, ex-Citigroup executive Olayemi Cardoso, is yet to be confirmed in his role, while the acting governor and four deputy governors have resigned, effectively leaving a policy-making vaccuum at the top. 


©2023 Bloomberg L.P.