The naira made a modest gain against the dollar, trading at N1,498.25/$ at the Nigerian Autonomous Foreign Exchange Market, despite recent fluctuations.
This slight improvement follows a series of circulars issued by the Central Bank of Nigeria (CBN) to combat forex racketeers and financial irregularities.
In response to the challenges, the CBN implemented measures aimed at stabilizing the forex market. Among these, banks were instructed to cease cash payments for Personal Travel Allowance, while International Oil Companies were directed to repatriate revenue in two phases rather than all at once.
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Despite these efforts, the naira’s value remained under pressure. At the parallel market, it depreciated to N1,600/$, reflecting a growing gap between official and parallel rates. This trend has fueled uncertainty among currency traders and consumers alike, with many expressing concerns over the weakening naira.
Nigerians continue to flock to black market vendors, seeking foreign currency despite the CBN’s interventions. The persistence of this demand underscores the challenges facing the country’s currency stability.
Experts warn of further depreciation, with projections suggesting the naira could weaken to N1,500/$ in 2024. This alarming forecast highlights the urgency of implementing effective measures to safeguard the currency’s value and restore market confidence.
The CBN’s actions also targeted price manipulation in trade transactions, with revised guidelines aimed at curbing over-invoicing of imports and under-invoicing of exports. These measures, though necessary, underscore the complexity of Nigeria’s forex landscape and the need for comprehensive reforms.
As the CBN intensifies efforts to address forex challenges, including liquidity issues and cash pooling activities by International Oil Companies, the path to currency stability remains uncertain.
However, decisive action coupled with prudent economic policies could pave the way for a more resilient forex market in Nigeria.