The Nigerian Naira continued its downward spiral yesterday, hitting a new low of N1,770 to the US dollar in the parallel market. This represents a significant depreciation from the N1,750 rate recorded just last weekend.
The trend isn’t isolated to the parallel market. The Nigerian Autonomous Foreign Exchange Market (NAFEM) also witnessed a decline, with the Naira weakening to N1,675.62 per dollar. This marks an N23 depreciation compared to the previous weekend’s rate of N1,652.62 per dollar.
The volume of dollars traded on NAFEM also experienced a significant drop, plummeting by 55.2% to $108.79 million from the previous week’s $243.05 million.
As a result of these developments, the gap between the parallel market and NAFEM rates has widened to N117.38 per dollar, up from N97.38 per dollar last weekend.
This continued depreciation of the Naira is a cause for concern for many Nigerians, as it erodes purchasing power and fuels inflation. The impact is particularly felt by businesses and individuals who rely on foreign exchange for imports and other transactions.
Experts attribute the Naira’s weakness to various factors, including declining foreign exchange reserves, rising inflation, and persistent insecurity challenges. The Central Bank of Nigeria (CBN) has been implementing various measures to stabilize the currency, but the impact of these efforts has been limited thus far.
As the Naira continues to struggle, it remains to be seen what steps the government and the CBN will take to address the underlying issues and stem the currency’s decline.
