CBN allows naira to weaken 2% to record low

Date:

ABUJA – Nigeria’s central bank allowed the naira to drop about 2% on the official market to a record low on Wednesday, but the currency’s rate remained above where it trades at central bank auctions and on the black market.

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Nigeria is trying to find a way to unify its multiple exchange rate system, used to keep the naira artificially strong.

New President Bola Tinubu told members of his governing party last week that the country would not have multiple exchange rates anymore.

The naira fell as low as 475 naira to the U.S. dollar from Tuesday’s trades of around 465 naira, before recovering to 466 naira.

Traders said the central bank had allowed them to trade the currency as weak as 475 naira to the dollar on the official market, outside a previous band of 460 to 467 naira to the dollar.

In the past, the bank has allowed the naira to weaken in 5 naira increments.

The central bank has been adjusting the naira gradually on the official market to avoid a large-scale devaluation.

The bank sold the dollar at 645 naira at its Friday auction, fuelling speculation that a devaluation which could weaken the official exchange rate closer to the auction level was imminent.

Last Thursday, the central bank denied devaluing the naira, following media reports of a big fall in the currency after Tinubu met the central bank governor.

Gbenga Samson
Gbenga Samsonhttp://ThisDayLive.com
Samson Gbenga Salau [Editorial Board Adviser] Gbenga Samuel Salau is a professional journalist with over 17 years experience in journalism, he is a graduate of Communication and Language Arts, University of Ibadan. On completion of his youth service, he joined The Guardian as a freelance journalist and was later absorbed as a staff. While in the University, he was a campus journalist reporting for the Independence Hall and Faculty of Arts Press Clubs. As a campus journalist, he won the following awards; Independence Hall Press Best News writer; University of Ibadan Union of Campus Journalists’ Best News Reporter/Writer; First Runner-up, Reuben Abati Award for Investigative Journalism; Association of Faculty of Arts Students’ Press Best Reporter; University of Ibadan Union of Campus Journalists’ Best Political Writer; Winner, Reuben Abati Award for Investigative Journalism, and University of Ibadan Union of Campus Journalists’ Best Interviewer. He served the Association of Communication and Language Arts Students, as the Public Relation Officer, the same year he was appointed the News Editor of the Association of Faculty of Arts Students Press. The following session, he was made the General Editor, and a member of the 13-man University of Ibadan Students’ Union Transition Committee. As a reporter in The Guardian, in 2014, he won the Promasidor Quill Award Best Report on Nutrition and DAME Business Reporting category. In the 2015 edition of the Promasidor Quill Award, he won the best Report on Nutrition and Brand Advocate Categories, while in 2016, he won the NMMA Print Journalist of the Year, first runner-up Golden Pen Reporter of the Year and SERAs CSR Awards. Gbenga Salau loves traveling, reading, and listening to songs with good lyrics no matter the genre.

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