The naira will depreciate further this week due to increasing excess demand in the market and speculations that the authorities might depreciate it to N150 per dollar, which is the budget benchmark, to counter the effect of dwindling revenue occasioned by the impact of the recent decline in crude oil prices on the nations export earnings from crude oil.
Last week, the naira moved closer to the N150 per dollar mark, as it depreciated by 15 kobo at the official market where the official exchange rate rose to N148.89 per dollar from N148.75 per dollar previous week following over 100 per cent jump in demand at the Wholesale Dutch Auction System (WDAS) sessions conducted by the CBN. Demand rose to $726.26 million from $304.08 million the previous week. Total amount sold also rose from $304.08 to $600 but not enough to meet the rise in demand.
The unsatisfied demand impacted on the naira in the inter bank market as the interbank exchange rate rose from N151.205 to N151.325 per dollar, indicating 12.5 kobo depreciation.