Nigerian currency, the Naira fell significantly against the U.S. dollar at the official market on Wednesday as it exchanged hands with the greenback at N415.10 per $1, the lowest rate ever recorded at that market segment, implying a N0.80 or 0.20% devaluation from N414.30 per $1 rate it exchanged on Tuesday.
So, at the black market in Abuja and Uyo, dealers exchanged the naira within the range N568.00 and N570.00 to a dollar on Wednesday. The same rate it traded at the previous session on Tuesday.
This came two days after Vice President Yemi Osinbajo urged the Central Bank of Nigeria (CBN) to have a “rethink” of its foreign exchange management policy.
Osinbajo angered supporters of the current policy on Monday when he said naira was artificially strong and its exchange rate should reflect its actual market value to encourage foreign investment. Many have also hailed his call.
“As for the exchange rate, I think we need to move our rates to [be] as reflective of the market as possible. This, in my own respective view, is the only way to improve supply,” the vice president said.
“We can’t get new dollars into the system, where the exchange rate is artificially low. And everyone knows by how much our reserves can grow. I’m convinced that the demand management strategy currently being adopted by the CBN needs a rethink, and that is just my view.
“Anyway, all those are issues that when the CBN governor has time to address, he will be able to address in full.”
Osinbajo lamented the lack of access to forex for the importation of systems and raw materials as one of the contributory factors of the current economic situation, and said the CBN appeared to be in competition with government ministries and agencies in implementing certain policies.
The vice president responded to the criticisms on Tuesday, saying, his call was not for the devaluation of the Naira.
Within the past weeks, the exchange rate of the domestic currency and the dollar hovered around the range of N412.00 to N414.00 and above benchmark before clinching a new low of N415.10 on Wednesday.
Naira’s performance on Wednesday became significant as foreign exchange supply skyrocketed by 99.99 per cent with $306.77 million recorded as against the $153.39 million posted in the previous session on Tuesday.
The currency oscillated to an intraday high of N405.00 and to a low of N419.00 before closing at N415.10 per $1 at the close of business on Wednesday.