Naira suffers major depreciation, dropping by more than N200 at official market before bouncing back

The nation’s currency is still in dire need of attention, as the naira had its largest decline in recent memory when it was exchanged for N1,105 at the Nigerian Autonomous Foreign Exchange Market (NAFEM), an official market approved by the Central Bank of Nigeria (CBN).

Within hours of opening at N830 earlier in the day, the value of the currency dropped by more than N200. But the decline did not endure, as the currency recovered and closed yesterday at 841.14.

The dramatic decline in the value of the currency yesterday, according to Reuters, “brought the official exchange rate within touching distance of the parallel market rate.”

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The dollar started at N1,135 at the parallel market and ended between N1,150 and N1,200.

“Today we are buying at N1,100 and selling at N1,150,” stated Alhaji Hassan Sabo, a Bureau De Change (BDC) operator at a well-known market in Lagos.

“It cannot come down like that because the dollar is not available, some are not even selling at the rates I just gave you,” he responded when asked if there was any chance of the rate falling. It may even be posted tomorrow.

Samuel Showunmi, a capital market specialist, suggested that the government go back to having several exchange rates in order to force dollars into the market via the BDC.

“What we are witnessing at the moment involves currency racketeering in the banking industry as well,” he declared.