Naira Plunges to 950/$ at Black Market as Forex Crisis Worsens

The Nigerian currency, Naira, suffered a sharp depreciation against the US dollar on Wednesday, closing at 950/$ at the parallel market, also known as the black market. This represents a 4.4 percent decline from 910/$ on Tuesday.

A Bureau De Change Operator in Wuse Zone 4 Abuja, Ahmez Gazali, confirmed the exchange rate to Newsflash Nigeria on Thursday morning.

He said that the demand for dollars was high and the supply was low, leading to the Naira’s fall.

Meanwhile, at the official market, the Naira also weakened against the dollar, closing at 758.12/$1 on Wednesday from 742.10/$1 on Tuesday, according to FMDQ forex data.

The forex crisis in Nigeria has persisted despite the Central Bank of Nigeria’s (CBN) decision to float the Naira on June 14. The CBN had hoped that the move would attract more foreign exchange inflows and ease the pressure on the Naira.

However, the country’s currency has continued to fluctuate amid low oil prices, dwindling foreign reserves, and economic recession. The forex crisis in Nigeria has been persisting for months, and it is now having a significant impact on the economy.

The CBN has taken a number of steps to address the forex crisis, but they have not been successful in stabilizing the naira. Last week, the Acting Governor of the CBN, Folashodun Shonubi, promised to clear the backlog of forex within two weeks, but it remains to be seen whether he will be able to do so.

Newsflash Nigeria recalls that many businesses and individuals have been affected by the forex scarcity, which has made it difficult to import goods, pay for services, or travel abroad. Some analysts have called for more policy reforms and diversification of the economy to address the forex challenge.

The naira’s depreciation is having a number of negative consequences for the Nigerian economy. It is making it more expensive for businesses to operate, and it is reducing the purchasing power of consumers. This is leading to higher inflation and slower economic growth.

The Nigerian government needs to take urgent action to address the forex crisis and stabilize the naira. This may involve a combination of measures, such as increasing the supply of foreign exchange, reducing government spending, and improving the business environment.

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