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Naira Reaches Historic Peak Against US Dollar Amidst Economic Challenges

by Vicky Oselumese
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Naira Reaches Historic Peak Against US Dollar Amidst Economic Challenges

The Nigerian Naira has recently reached a historic peak against the US dollar, hitting N1,607 in intra-day trading on February 15, 2024.

This surge in value comes at a time when Nigeria is facing escalating demand pressure, further undermining the currency’s stability.

The official exchange rate closed at N1,469.97 to $1 on the same day, highlighting the volatility of the Nigerian Naira.

In addition to the currency’s volatility, Nigeria is also grappling with a significant surge in inflation.

According to the National Bureau of Statistics (NBS), January’s inflation rate soared to 29.90%, indicating severe economic challenges facing the nation.

This alarming increase underscores the pressing need for effective measures to stabilize the economy and protect the purchasing power of citizens.

In response to the persistent demand pressure, the Central Bank of Nigeria (CBN) announced several measures on February 15 aimed at promoting transparency and stability in the foreign exchange market while addressing forex malpractices.

These measures include policy changes such as discontinuing cash payouts for Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) and requiring international oil companies (IOCs) operating in Nigeria to retain 100% of their forex proceeds within the country.

Despite these efforts, the Nigerian Naira only appreciated marginally at the end of the week, closing at N1,498.25 to a dollar.

The intraday high recorded a record high of N1,607/$1, while the intraday low was N1,100/$1, representing a wide spread of N507/$1.

Forex turnover at the close of trading was $323.41 million, a significant increase compared to the previous day.

In the parallel forex market, the naira depreciated marginally, with an exchange rate of N1,565/$1.

The Great British Pound (GBP) closed at £1/N1,910, and the Euro closed at N1,630/EUR1. In the cryptocurrency market, the Naira settled at N1,613/$1.

This article was updated 2 months ago

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