The naira has significantly declined against the dollar in foreign exchange markets following the Central Bank of Nigeria’s (CBN) latest interest rate increase.
Dayyabu Ashiru, a Bureau De Change operator in Wuse Zone 4, Abuja, said that the naira was trading at N1,590 per dollar on Tuesday, down from N1,570 the day before. “We buy at N1,580 per dollar and sell at N1,590,” he stated, indicating a N20 loss.
Similarly, the naira weakened in the official foreign exchange market. According to FMDQ data, the currency fell to N1,548.76 per dollar on Tuesday from N1,500.32 on Monday, marking a N48.44 decline.
This depreciation occurred despite the CBN selling $106.5 million in foreign currency to authorized dealers last Wednesday and Thursday. The currency’s drop follows the CBN’s decision to raise the interest rate to 26.75 percent on Tuesday, up from 26.25 percent in May.