The naira plunged to a record low against the dollar as availability of the US currency in Nigerian markets declined sharply, adding pressure on the central bank to raise rates to attract foreign-exchange inflows at its policy meeting the week after next.

Nigeria’s currency weakened 4.2% to close at 1,534.39 in the so-called NAFEM window on Monday, according to data published by FMDQ, which calculates the exchange rate. It is the lowest that the currency has traded against the dollar since Bloomberg started compiling the data.

The more than 60% drop in dollar-trading volumes in the official foreign-exchange market put pressure on the currency, Lagos-based investment banking firm Chapel Hill Denham said in a note on Tuesday morning, adding that “spot transactions were executed within the range of 1,000 naira to 1,550 naira.”

Nigeria’s central bank has implemented several measures since the beginning of this year aimed at boosting market dollar liquidity, pricing and investor confidence. Central Bank Governor Olayemi Cardoso told lawmakers last week that foreign investors have already begun to supply the much-needed foreign exchange to the economy due to the reforms disclosing that more than $1 billion has been attracted into the market as a result.

“We saw some improvements in liquidity but it has not been consistent,” said Ayodeji Dawodu, director of fixed income for Central and Eastern Europe, Middle East and Africa at Banctrust Investment Bank Ltd. in London. “Liquidity will help price discovery and that is where the focus of the central bank should be.”

At the parallel market where residents that can’t access the official market are forced to obtain the foreign currency, the naira traded stronger at 1,497 per dollar, according to Abubakar Mohammed, chief executive officer for Forward Marketing Bureau de Change Ltd., which compiles the data in Lagos.

“If the fall in the official market continues, it will slide back into the parallel market,” Dawodu said.