NAIRA WEAKENS TO N1,234/$ AT OFFICIAL MARKET

Key Points:

• Nigerian Naira (NGN) depreciated to N1,234 per USD on Monday at the official foreign exchange market.
• This represents a 5.26% decline (N65) from Friday’s rate (N1,169.99).
• The weakening coincides with CBN Governor Yemi Cardoso’s recent statement prioritizing reserve protection over defending the Naira.

Market Fluctuations and CBN Policy Shift

• Earlier optimism of the Naira trading below N1,000 per USD has reversed.
• Nigeria’s external reserves have been dropping, reaching a new low of $32.1 billion on April 18th, 2024.
• Governor Cardoso, at the IMF/World Bank Spring Meetings, emphasized a policy shift:
  • The CBN will not actively intervene to maintain the Naira exchange rate.
  • Recent reserve decline is not related to Naira defense.

Background:

• The Naira previously experienced significant depreciation (reaching N1,950 per USD) in the weeks leading to a government crackdown on cryptocurrency exchange Binance.

Uncertainties:

• The impact of the CBN’s new policy on the Naira’s long-term stability remains unclear.
• Whether this depreciation is a temporary correction or a sustained trend is yet to be seen.

https://statisticss.com/2024/04/25/naira-weakens-to…-official-market/

Source: Techeconomy