The demand for dollars since the commencement of January 2024, has caused the parallel market exchange rate to experience a major decline, with the naira plunging to a record low of N2040 per Great Britain Pound, GBP.
This has been said to have been driven by persistent demand pressures that continue to erode the currency’s value as this marks a notable decrease of 5.39 percent or N110 compared to the N1,930 rate recorded the previous day.
The depreciation, standing as an unprecedented occurrence, is now the lowest point in the historical performance of the Naira.
According to the National Bureau of Statistics, NBS, report for January 2024, black-market exchange rates have continued to witness the devaluation of the Nigerian naira, exacerbated by a substantial surge in inflation.
The inflation rate surged to 29.90 percent, indicating a significant rise from the 28.92 percent recorded in the previous month.
According to the data, it reflects a significant uptick in the headline inflation rate for January 2024, with a 0.98 percent increase compared to December 2023 figures.
These developments persist despite the Central Bank of Nigeria, CBN’s, implementation of several policies aimed at bolstering the supply of foreign exchange.
One of the recent policies was the CBN’s announcement of halting international oil companies, IOCs, operating in Nigeria from immediately remitting 100 percent of their foreign exchange proceeds to their parent companies abroad.
In the same vein, the naira depreciated against the dollar in the parallel foreign exchange market, with the exchange rate quoted at N1,655 to a dollar, reflecting a 3.93 percent decrease from the N1,590 rate it closed on the previous day
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