UPDATED: Naira Weakens to 999 per dollar on official market…

Date:

LAGOS, Oct 19 – Nigeria’s naira hit a new record low of 999 per dollar on the official market on Thursday, Refinitiv data showed, in line with weakness on the parallel market as dollar shortages continued to put pressure on the currency.

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The naira has been in free-fall on the unofficial market, where it trades freely, which worsened after currency restrictions were lifted on the official market in June.

On Tuesday, it slumped to 1,100 to the dollar on the parallel market, and 980 per dollar on the official market, Refinitiv data showed.

The country’s transition to a more flexible exchange rate system has intensified pressure on the currency.

On Tuesday, the naira weakened by 8.9%, hitting 848.12 against the dollar in the official market, the most substantial decline since June 20.

While the street rate remained stable at 1,052 to a dollar, the disparity between the official and parallel markets widened, reflecting persistent market illiquidity in the absence of central bank intervention.

This shift follows the Central Bank of Nigeria’s decision to relax foreign exchange controls in mid-June, aiming to unify the nation’s multiple exchange-rate system, a move triggered by President Bola Tinubu’s criticism of the bank’s monetary policies.

Despite briefly aligning with the illegal market, the official rate plummeted by 40%, only to diverge again as the spread started to widen.

In response, the central bank scrapped restrictions that had been in place for eight years to manage the demand for dollars, highlighting the need to establish a clear exchange rate.

Nigeria, the largest oil producer in Africa, has grappled with a persistent shortage of dollars, stemming from a decline in oil revenue that has jeopardized its foreign-exchange reserves.

In an effort to stimulate local production, authorities halted the sale of foreign currency to importers of items such as rice, vegetables, and chicken.

Godwin Okafor, The Naija247news
Godwin Okafor, The Naija247newshttps://naija247news.com
Godwin Okafor is a veteran Financial Journalist, Internet Social Entrepreneur, and the visionary Founder of Naija247news Media Limited. With an extensive career spanning over 16 years in financial journalism, Godwin possesses a wealth of experience that seamlessly bridges both traditional and digital media landscapes. His journey in journalism commenced at Business Day, Nigeria, where he laid the foundation for his prolific career. In 2010, Godwin took a bold step by founding Naija247news Media, a platform that has since become a prominent player in delivering timely and accurate news. Educationally, Godwin Okafor holds a Bachelor's degree in Industrial Relations and Personnel Management from the prestigious Lagos State University, Ojo, Lagos. His commitment to continuous learning led him to the Lagos Business School, where he further honed his skills. Additionally, he is recognized as a Fellow of the University of Pennsylvania, having successfully completed the Wharton Seminar for Business Journalists. Throughout his illustrious career, Godwin has earned acclaim by winning numerous journalism awards, a testament to his dedication to excellence in reporting. Beyond his role as a Financial Journalist, Godwin Okafor wears the hat of the Chairman at Emmerich Resources Limited, the publishing entity behind Naija247news. His visionary leadership has played a pivotal role in shaping the media landscape and establishing Naija247news as a trusted source of information. Godwin Okafor's multifaceted expertise, commitment to journalistic integrity, and leadership in the realm of business journalism underscore his influential presence in both the media and entrepreneurial spheres.

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