Nigerian Naira Hits Record Low, Exchanges Above 2,000 Naira Against British Pound at Parallel Market

February 19, 2024February 19, 2024

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In a concerning development, Nigeria’s local currency, the Naira, has reached a historic low, trading at over 2,000 Naira against the Great Britain Pound at the parallel market. Malam Ibrahim, a Bureau de Change operator at Wuse Zone 4, confirmed the alarming exchange rates on Monday, attributing them to the persistent high demand for foreign currencies.

Over the weekend, the Naira’s value plummeted further, with the exchange rate against the British Pound rising from N1,930 to above 2,000 Naira. This decline represents the lowest point in the Naira’s historical performance, raising concerns among market participants and observers.

Notably, the Naira also experienced depreciation against the United States Dollar in the parallel forex market. It is currently trading at N1,673 per dollar, compared to N1,670/$ on Friday.

These developments come despite the Central Bank of Nigeria’s (CBN) implementation of various policies aimed at improving the supply of foreign exchange. One such policy was the recent directive prohibiting international oil companies operating in Nigeria from immediately remitting 100 percent of their forex proceeds abroad. Despite these efforts, the demand for foreign currencies, particularly the British Pound and the US Dollar, continues to surge.

Market analysts attribute the persistent decline of the Naira to the steady increase in demand for dollars, which has been observed since the beginning of January. The heightened demand is mainly driven by businesses restocking goods and acquiring raw materials, necessitating a greater need for foreign exchange.

The CBN’s efforts to stabilize the currency and address the foreign exchange challenges faced by the country will be closely watched in the coming days.