- Naira depreciation continues, trading at N1,510 to a dollar in the parallel market, marking a notable decline
- Despite CBN interventions to stabilize the naira, including supplying dollars to BDC operators, the currency’s weakening persists
The naira’s depreciation persisted over the weekend, with the currency trading at N1,510 to a dollar in the parallel market and 1,466.31 at the official market. This marks a notable decline from its previous levels, with the exchange rate increasing by N40 between Thursday and Friday alone.
Despite recent efforts and interventions by the Central Bank of Nigeria (CBN) to stabilize the naira, including supplying dollars to Bureau De Change (BDC) operators to boost liquidity, the currency has continued to weaken. Just a few months ago, the naira had shown signs of strengthening, trading below N1,000 to the dollar.
According to a Bureau De Change operator, increased demand for dollars and insufficient supply have contributed to the recent rise in the exchange rate. The CBN has consistently sold dollars to registered BDC operators at discounted rates as part of its measures to stabilize the naira. However, despite these efforts, the naira’s performance has been underwhelming.
The CBN has implemented various reforms, including clearing foreign exchange backlogs and acting against unregistered BDC operators to curb speculation. However, Bloomberg’s report that the naira was the world’s worst-performing currency over the last month indicates that the currency’s challenges persist.