In a concerning turn of events, the Nigerian currency has experienced a depreciation against both the pound sterling and the euro. According to recent data from the Central Bank of Nigeria (CBN) on Monday, March 11, the naira fell against the pound by N54.89, trading at N2,091.02/£1 compared to the previous session’s value of N2,036.13/£1.
Similarly, against the euro, the naira lost N39.09, closing at N1,779.47/€1, contrasting with the previous session’s N1,740.38/€1. However, there was a slight improvement in the black market, with the local currency gaining N8 to quote at N1,615/$1 compared to the previous trading session’s N1,623/$1.
The news follows an earlier report from Legit.ng, revealing that US-based investment bank Goldman Sachs has made predictions regarding the Naira’s exchange rate against the dollar. According to Goldman Sachs, the naira is expected to rebound and close the year at N1,200 per dollar at the official market.
Monday’s exchange rate represents a 0.6% or N9.44 appreciation compared to last Friday’s rate of N1,627.40/$1. Data from FMDQ Securities indicates that in the official market, the Nigerian Autonomous Foreign Exchange Market (NAFEM), the naira closed at N1,617.96/$1 on Monday, March 11, 2024.
Despite this, FX trades dropped to $96.13 million on Monday, significantly lower than the $269.35 million achieved on the previous trading day. It’s worth noting that the Nigerian currency currently exchanges in both the official and black markets above N1,600 against the US dollar.
This may cause concern and anxiety among individuals who rely on foreign currency transactions or have savings denominated in foreign currencies. The depreciation could lead to increased costs for imported goods and services, potentially impacting consumers’ purchasing power and standard of living.
Furthermore, fluctuating currency values not only affect financial markets but also impact everyday Nigerians, potentially influencing purchasing power, consumer confidence, and overall economic stability. As the nation navigates through these currency fluctuations, hopes remain pinned on the predictions of a potential rebound by investment experts.
And also, the mention of the naira rebounding and predictions from investment banks like Goldman Sachs may offer some hope to investors and market participants. However, uncertainty regarding future exchange rate movements may persist, leading to cautious behavior and decision-making among stakeholders.
