Naira Slumps to 1,610/$ on Black Market

The Nigerian currency, the naira, hit a record low on Wednesday, plunging to 1,610 against the US dollar, as acute dollar shortages intensify across the parallel markets of Lagos.

Despite a somewhat stagnant demand exacerbated by the rising costs, the gap between buying and selling rates on the streets of Lagos indicates a marginal but steady erosion of value, with traders buying at N1,600 and selling at N1,610, a N5 loss compared to the stable rate of N1,605 witnessed over the previous three days.

“The demand for dollars is currently not as high due to the skyrocketing rates, but we’re feeling the pinch because it’s summer, people are traveling, and there’s also the rush for school fees by foreign students,” explained a local currency trader who preferred to remain anonymous.

Further compounding the naira’s woes, the Nigerian Autonomous Foreign Exchange Market (NAFEM) noted a significant depreciation earlier in the week, with the currency weakening by 0.81 percent from N1,579.22 to N1,592.06 on Tuesday.

ALSO READ: How Tinubu Spent N2.3bn on Foreign Trips in 6 Month

Financial experts speculate that the naira’s downward trajectory might not be solely tied to the Federal Government’s recent dollar bond issuance.

Last week, the Debt Management Office (DMO) announced a new $500 million tax-exempt bond aimed at both local and foreign investors, with a ten-year tenure.

As policymakers scramble to stabilise the currency, everyday Nigerians and business owners brace for the ripple effects of the naira’s depreciation, which could mean higher prices for imported goods and increased financial strain.