The Naira depreciated against the US dollar at the parallel foreign exchange (FX) market in the noon hours of Tuesday when it traded at N1,630/$1, representing a 1.84% depreciation from the N1,600 rate it closed at on Monday.
Also, market assessment conducted by our correspondent in the Federal Capital Territory (FCT) reflected that the local currency traded at N2.050 for one British Pound Sterling, which was one of its lowest exchange rates over the past week.
The Naira’s exchange rate against the Pound Sterling on Tuesday indicated a significant depreciation in its value by 7.32% or N150 when compared to the N1,900 rate it traded the previous day at the unofficial FX market.
Similarly, the Naira weakened against the Euro by 0.57%, trading at N1750/EUR1 compared to N1740/EUR1 it traded the previous day, reflecting persistent demand pressures that have contributed to the depreciation of the currency’s value in recent weeks.
The sluggish performance of the local currency at the FX markets is worrisome to many analysts amid efforts of the Central Bank of Nigeria’s (CBN) to improve FX supply through various policy interventions, the forex markets.
Market analysts have linked the depreciation of the Naira to increasing demand for US dollars even when supply continued to decline.
According to data from the monetary authorities, the rising demand for the Greenback (USD) is attributed to restocking of goods or acquisition of raw materials by manufacturers and traders as well as rising cost of overseas school fees by young Nigerians studying overseas, among others
