Naira Plummets to N1,100 per Dollar in Parallel Market Amidst NAFEM Depreciation

The Nigerian Naira experienced a significant depreciation in both the parallel market and the Nigerian Foreign Exchange Market (NAFEM) on April 17, 2024.

The exchange rate in the parallel market plummeted to N1,100 per dollar, a sharp drop from its previous rate of N1,080 per dollar just a day prior.

The NAFEM exchange rate also saw a decline, with the indicative exchange rate for the Naira rising to N1,148.14 per dollar from N1,136.04 per dollar, indicating a depreciation of N12.1.

This sudden depreciation in the Naira’s value has narrowed the margin between the parallel market and NAFEM rates to N48.14 per dollar, a notable decrease from the previous margin of N56.04 per dollar.

The parallel market rate has been a point of concern for the Nigerian economy, as it often reflects the true value of the Naira in the global market.

The depreciation in the Naira’s value in both markets has raised questions about the stability of the Nigerian economy and the effectiveness of its monetary policies.

With the margin between the parallel market and NAFEM rates narrowing, it remains to be seen whether the Central Bank of Nigeria will take action to stabilize the currency and prevent further depreciation.

This development comes at a time when the global economy is still recovering from the effects of the COVID-19 pandemic, which has had a significant impact on the global financial markets

. The depreciation of the Naira is a cause for concern for both the Nigerian government and its citizens, as it could lead to an increase in the cost of imported goods and services, further exacerbating the country’s economic challenges.

As Nigeria continues to grapple with the challenges posed by the global economic downturn, the depreciation of the Naira serves as a stark reminder of the need for the government to implement effective economic policies to stabilize the currency and promote sustainable growth.