Forex Update: Naira Experiences 7.91% Decline Against USD

The Nigerian Naira faced a decline against the US Dollar at the official foreign exchange market. Official data from FMDQ revealed that the Naira depreciated to N951.22/$1 on Wednesday, marking a 7.91% or 144.49 loss compared to Tuesday’s rate of N806.73/$1.

This drop signifies the first instance of the Naira weakening against the US Dollar this week. The reduction coincided with a 4.94% decrease in dollar supply, which fell from $142.63 million to $135.58 million.

The parallel market also experienced a marginal depreciation, with the Naira trading at N1175/$1 on Wednesday, up from N1170/$1 the day before.

Governor of the Central Bank of Nigeria, Dr. Olayemi Cardoso, addressed concerns about the Naira’s stability during a recent speech at the Chartered Institute of Bankers of Nigeria’s 50th-anniversary event. Despite the recent fluctuations, he expressed confidence and optimism, stating, “I’m confident and optimistic that by taking appropriate corrective actions and strategic steps, we can restore macroeconomic stability and address fundamental flaws.”

Since the Central Bank floated the Naira on June 14, the country’s currency has encountered ongoing fluctuations in the foreign exchange market. Financial expert Prof Godwin Oyedokun attributed Nigeria’s forex crisis to weak economic fundamentals, low foreign reserves, increased external debts, and the existence of a double forex window.