The Nigerian Naira plummeted to N1,300 against the US Dollar on the black market, signaling a sustained decline against its global counterparts following the decision of the Federal Government to devalue the currency and remove the nation’s subsidies.
Bureau de Change operators have attributed the persistent decline to the increase in demand for the scarce greenback by manufacturers and other users looking to access the American Dollar for the import of raw materials.
In the cryptocurrency section, the local currency traded at N1,315.3/$1 on the same day, highlighting the vulnerability of the Nigerian Naira at various forex segments.
The alarming rate at which the Naira is devaluing adds pressure to an already fragile economic landscape.
Despite the government’s efforts to inject liquidity into the official market, the Naira’s fall persists.
The official Investor and Exporter Window reported a closing rate of N878.57/$, further underscoring the disparity between official and parallel market rates.
The ongoing challenges in the foreign exchange market raise concerns about Nigeria’s economic stability.
Efforts by the government, such as a $2.25 billion oil-for-cash loan facility from the African Export-Import Bank, aimed at bolstering FX liquidity, haven’t been sufficient to stem the Naira’s decline.
While the government anticipates a boost from ongoing initiatives and repayment strategies, the naira’s current trajectory raises questions about the effectiveness of these measures in achieving the much-needed convergence between the official and parallel markets.
The continued devaluation poses a threat to investor confidence and the overall economic health of the nation.
