Experts concurred that the CBN’s approach to currency management was the primary cause of Nigeria’s precarious position in its foreign exchange reserves.
With 290 basis points separating the official rate from the market-driven, unofficial parallel market, parallel markets have emerged as a result of the central bank’s fixed-rate, regulated exchange policy.
The naira has dropped from N453.58 to N460.98 per dollar during the previous ten weeks. There is no “positive signal that denotes an improvement in forex supply relative to the pre-pandemic levels,”
According to the investment banking firm Cordros Capital, which predicted that Nigeria’s inability to increase its foreign exchange reserves and meet the demand will persist over the short-to-medium term.