Nigeria’s currency, the naira, experienced a sudden 5% slump against the US dollar on the streets of the West African nation.

This free fall in the naira’s value in the official market prompted a rush by residents to seek refuge in the safe haven of the greenback.

The naira’s exchange rate plunged to 1,110 to a dollar, a significant drop from 1,052, according to Abubakar Mohammed, the CEO of Forward Marketing Bureau de Change Ltd.

This alarming depreciation came on the heels of the Central Bank of Nigeria’s unprecedented decision to allow the naira to depreciate by 8.9% to a record low of 848.12 a dollar in the official market, as announced on Tuesday.

As a result of this economic instability, many Nigerians are frantically looking to stock up on US dollars.

According to Mohammed, “There is no supply of the dollar, yet a lot of people are looking for it to travel or do business.”

Nigeria’s ongoing struggle to stabilize the naira has seen a decline of over 40% since President Bola Tinubu took office in May, vowing to unify the nation’s foreign-exchange market.

This unfortunate situation has led to a significant gap of approximately 24% between the official and parallel market exchange rates.

Earlier this month, the central bank further contributed to the naira’s woes by lifting restrictions on the purchase of foreign currency, which was previously required to import 43 items, including rice, vegetables, and chicken.

These restrictions, in place for over a decade to promote local production, backfired, driving up the demand for dollars on the parallel market.