The naira witnessed a staggering decline, marking its most significant fall in recent times, as it reached N1,105 at the Nigerian Autonomous Foreign Exchange Market (NAFEM), the Central Bank of Nigeria’s (CBN) authorized official market.
Within hours, the naira experienced a dramatic drop of over N200 from its opening rate of N830. However, the currency swiftly recovered, closing at 841.14 by the day’s end.
Reuters reported that this rapid depreciation brought the official exchange rate remarkably close to the rates observed in the parallel market, where the naira began at N1,135 and concluded trading at N1,150 to N1,200, according to sources reported by Daily Trust.
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Alhaji Hassan Sabo, a Bureau De Change (BDC) operator in Lagos, indicated the prevailing rates: “Today we are buying at N1,100 and selling at N1,150.”
However, he expressed scepticism regarding a rate decrease, citing a shortage of available dollars and suggesting a potential increase in the following day’s rates.
Capital market analyst Samuel Showunmi expressed concern and advocated for the government’s reintroducing multiple exchange rates to inject more dollars into the market through BDCs.
He highlighted the observed currency racketeering within the banking sector, urging corrective measures to address the situation.