Bank notes in naira, dollars, euros and pounds sterling are pictured in Lagos, on January 26, 2016. (Photo by PIUS UTOMI EKPEI / AFP) (Photo by PIUS UTOMI EKPEI/AFP via Getty Images)

Nigeria Naira Touches 1000 Naira Against the US Dollar

On Tuesday, September 26, 2023, the Nigerian naira fell to the psychologically important threshold of 1,000 per dollar on the parallel market. This is the first time the naira has reached this level since 2017. The fall in the naira comes as Nigeria’s economy continues to struggle, with high inflation and unemployment despite President Bola Tinubu’s efforts to allow the free market to determine the currency’s value.

The currency’s decline has been attributed to a number of factors, including poor liquidity in the foreign exchange market, the strong dollar, and the nation’s outstanding forward payment debt of $6.8 billion.
Tinubu’s predecessor, Muhammadu Buhari, had maintained a tight grip on the central bank, which led to a decline in investor confidence and a reduction in dollar inflows.

Tinubu has attempted to address this by allowing the central bank more independence, but the currency has continued to depreciate.
The naira’s decline has had a significant impact on Nigerians, particularly young people who are trying to start businesses or study abroad. It has also made it more difficult for businesses to import goods and services, which has led to higher prices for consumers.

The acting governor of the Central Bank of Nigeria, Yemi Cardoso, faces an uphill battle in trying to stabilize the naira. If he is confirmed by the Senate, he will become the 11th governor of the CBN and will be responsible for managing the country’s turbulent foreign exchange market.

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