Nigeria has 3rd worst black market rates after Angola, Uzbekistan – Bloomberg predicts big Naira crash

According to a Bloomberg report, Nigeria comes 3rd in the list of five countries; Angola, Uzbekistan, Nigeria, Egypt and Tajikistan with alarming black market rates in what it described as ‘shadow dollars’.

The report gives that Nigerians are paying up to 70% above the official rate to get their hands on the dollars with the worst being Angola with 136% premium. 

The reports predict the Naira official rate is heading towards the black market value as it quotes a leading economist who said “the street rate is a better reflection of where a market based rate should be”.  The report said that non-deliverable forwards predict “the naira will drop another 30 percent from the official rate to N288 in 12 months, approaching the black market level that exceeds 300 per dollar.”

Nigeria’s current exchange rate is unsustainable and might lead to a dearth of investors who are losing heavily. 

“Countries like Nigeria are maintaining fixed exchange rates that are unsustainable. Once the pegs break, investors in the local currency face significant losses.”

Nigeria’s president, Muhammadu Buhari has rejected all forms of proposals to devalue the Naira.

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