The naira closed Monday at its lowest rate to the dollar since the Central Bank of Nigeria removed controls and allowed the currency to trade freely in a bid to boost foreign investment.
The central bank allowed the currency to float on Wednesday, recognising only the Investors and Exporters (I&E) window. The move that drove the currency to 664.04 at the official window the same day from 477 it traded the previous day.
The naira closed at 702.19 on Thursday and ended the week at 663.04.
On Monday, it fell to 770.38 at the official market, setting up the first parity with the black market in at least five years.
– Learn more
Nigeria has struggled with dollar shortage for years and the International Monetary Fund and the World Bank said the use of multiple exchange rates until last week helped drive away foreign investment.
The country recorded only recorded $468 million as foreign direct investment in 2022, about 30% lower than a year earlier, and 90% lower than its receipt in 2008.
President Bola Tinubu said unifying the exchange rates is a priority for his administration that came on board three weeks ago, but the devaluation threatens to worsen inflation that hit 22.41% in the year through May, the highest pace in 18 years, according to the National Bureau of Statistics said.
Discover more from Pluboard
Subscribe to get the latest posts to your email.