Naira Plunges To 260 Against US Dollar At Interbank Market

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The naira on Monday plunged to 264 against the United States dollar at the interbank market, in spite of the decision by the Central Bank of Nigeria (CBN) to scrap its fixed exchange rate and allow market forces to determine the value of the local currency.

It was gathered that at the commencement of the new foreign exchange regime, the naira started at N253 to a dollar.

Bloomberg reports that at about 11:02am on Monday, the naira had moved to 264 to the dollar at the inter-bank market, with dealers expressing extreme caution in proceeding with transactions.

Minutes later, the naira came to 260, which was the initial predicted position the CBN-FMDQ OTC guideline was planned to work with.

Several analysts have predicted that the naira may settle around 250, compared with 350 to the greenback on the black market.

Nigeria had pegged the naira to the dollar at 197-199 since March 2015, even as other oil exporters have let their currencies devalue in the wake of plunging global crude prices.

President Muhammadu Buhari also had previously said he would not “murder the naira” by letting it devalue.
However, last week, the CBN Governor, Godwin Emefiele, said that the currency market would now be “purely market driven” as the country grapples with spiralling inflation, slowing growth, the weakening naira and foreign exchange shortages.


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