Breaking News: Naira Falls Massively in Official Market & Black Market Ahead of Christmas
Naira Hits All-Time Low in Official Market Just Before Christmas
In a startling development, the Naira has experienced an unprecedented fall, reaching an all-time low in the official market, with a significant depreciation of 23.29% compared to its previous closing rate. This worrisome trend, occurring just 17 days before Christmas, raises concerns about its potential impact on the economy.
This marks the first instance where the Naira has crossed the N1,000/$ threshold, indicating a substantial depreciation that sparks worries about its repercussions on various sectors. The Central Bank of Nigeria’s recent efforts to stabilize the foreign exchange market seem to have fallen short, intensifying worries about the upcoming holiday season.
The depreciation, now at N1,099.05 to a dollar, signifies a drastic decline compared to the previous closing rate of N843.07, marking an all-time low. The parallel forex market also witnessed a 0.59% depreciation, quoting N1180/$1, while peer-to-peer traders quoted around N1193.56/$1.
To address foreign exchange scarcity challenges, the Central Bank of Nigeria has extended the timeline for issuing letters of credit from 24 hours to five working days, as indicated in the newly approved 2023 service charter. The registration of Form M and NXP timelines has also been extended, reflecting the ongoing struggles with forex scarcity.
Financial experts suggest strategies for the Naira’s recovery, emphasizing the need to de-dollarize the economy. Recommendations include declaring local transactions in US dollars illegal, encouraging transparency in the I&E Window, and exploring alternative policies for a structurally weak economy.
This situation not only raises concerns about inflationary pressures and household budgets but also poses challenges for businesses, potentially leading to increased production costs and profitability issues. The unfolding forex crisis demands urgent attention and strategic interventions to stabilize the Nigerian economy.