The naira weakened further against the US dollar as trading commenced this week due to high demand for foreign exchange.
At the Nigerian Foreign Exchange Market (NFEM), the local currency dropped to N1,530.15/$1 on Monday, a 1.51% decline from Friday’s closing rate of N1,517.24/$1. This is a 2.07% drop compared to the previous week.
In the parallel market, the naira also fell to N1,570/$1, a 0.64% decline from the previous close.
During intraday trading, the naira reached a high of N1,540/$1 and a low of N1,512/$1 at the official market, creating a price difference of N28/$1.
The naira also lost value against other major currencies. The euro traded at N1,620/€1, down by 2.53% from N1,580/€1 last Friday. Similarly, the British pound rose to N1,970/£1 from N1,930/£1.
Financial experts say the fall in the naira’s value is due to increased demand for dollars by businesses and individuals, growing debt, and high inflation.
Some also point to factors such as declining foreign reserves and reduced foreign investments. AIICO Capital Limited anticipates the Central Bank of Nigeria (CBN) will continue taking steps to support the naira and help stabilise the currency.
