Naira Plunge: Unveiling the Forex Market’s Turbulent Ride

In a historic downturn, the Naira hit a staggering low, plummeting to N1,348.63 against the US Dollar in the foreign exchange market on Monday. FMDQ data revealed this unprecedented fall, marking a significant 33.87% decrease or N456.73 weaker than the N891.90 recorded just on Friday.

This alarming trend follows the Naira breaching the N1,000 per US dollar threshold on December 8th and 28th last year, registering at N1,099.05 and N1,043.09 per dollar, respectively. The parallel forex market also witnessed a 2.76% depreciation, quoting the exchange rate at N1,450 per US dollar.

Even with a notable 36.33% increase in forex turnover, reaching $64.29 million at the close of trading, the Naira’s depreciation remains a cause for concern. The Central Bank of Nigeria’s recent injection of N500 million into the forex market to clear verified forex backlog adds another layer to the unfolding economic dynamics. This move follows closely on the heels of the bank injecting approximately $2 billion to settle outstanding commitments in key sectors such as manufacturing, aviation, and petroleum.

As the Naira navigates these turbulent waters, stakeholders and observers are closely monitoring the evolving situation in the forex market, assessing the impact on various sectors of the economy.

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