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Nigeria’s naira continues to slide and reaches a record low of N995 to the dollar

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By Samuel Bankole

 

The Nigerian naira faced further depreciation this week as it continued its downward slide against the US dollar, with Nigerians seeking the dollar as a store of value to hedge against the rapid depreciation of the naira.

On Friday, the naira reached another all-time low of N995 to the dollar on the parallel market, as reports suggested that the dollar shortage persisted.

Earlier in the month, the naira began at N900 to the dollar on the parallel market but gradually weakened to the current level due to increased demand.

At the official market, the naira also posted losses against the dollar, with the exchange rate quoted at N747.76, compared to the previous rate of N738.00.

READ ALSO: Nigeria aims for 20,000 megawatts of electricity by 2026 and 60,000 megawatts by 2060

Analysts warned that if the current conditions persist, the naira could breach the psychological N1,000 to the dollar mark by next week.

Critics blamed the government for its lackluster response and failure to take decisive action following the announcement of foreign exchange reforms intended to stabilize the forex market.

They noted the lack of confidence in the system and the government as contributing factors to the naira’s decline.

However, some market participants are hopeful that the appointment of Olayemi Cardoso as the acting Central Bank of Nigeria (CBN) Governor and the potential increase in crude oil production could inject fresh impetus into stabilizing the market and supporting the local currency.

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