Nigerian Naira Continues Downward Trend Against Dollar, Central Bank Faces Monetary Pressure
The Nigerian naira maintained its depreciating trend against the dollar, reaching 876/$ at the parallel market on Sunday. Just a week earlier, it had traded at 820/$. The unification of exchange rates by the Central Bank of Nigeria, along with liquidity issues and speculation, contributed to the naira’s decline.
Bureau de Change operators reported that the exchange rate has been unstable, with the naira being bought and sold at 850/$ and 876/$. The continuous slide of the naira against the dollar has led to rising costs of goods and services, affecting businesses and consumers.
Opinion: The foreign exchange market in Nigeria is facing significant pressure due to factors like a surge in monetary expansion and unmet foreign exchange demand. The rapid growth in money supply poses risks to macroeconomic stability and price stability. The monetary authorities must investigate and take measures to control further monetary expansion.
