Naira Disappoints FG’s N700 Per Dollar Projection, Crashes on First Trading Day in 2024
- The naira crashed on the first trading day in 2024 as Nigerians returned to work after the Christmas and New Year holidays
- The exchange rate between the naira and the dollar on January 2, 2024, was at N988.50 per dollar
- The naira’s crash represents 8.9%, as the Nigerian government hopes the local currency will rally at N700 per dollar
Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
The Nigerian naira began the New Year very poorly, crashing by 8.9% against the US dollar on Tuesday, January 2, 2024.
The naira closed at N988.46 per dollar despite a $2.5 billion from Afrexim Bank injected into the economy to cushion the forex shortage in the country.
Source: Getty Images
Nigeria receives $2.2 billion from Afrexim Bank
Naira’s fall follows the disbursement of part of the $3.3 billion forex exchange support facility to the Nigerian government.
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Legit.ng reported that the Nigerian National Petroleum Company Limited entered into a crude swap deal with Afrexim Bank for the facility.
The fund was disbursed on the last day of 2023, according to reporting by Legit.ng.
The Afrexim Bank facility was intended to ease the acute forex shortage in the FX market.
The naira’s depreciation of 8.9% on the first trading day of the new year disappoints the expectation of the Nigerian government, which has pegged the foreign exchange rate at N700 per dollar in the 2024 budget.
Naira falls in all markets
Reports say the naira depreciation represents an N81.35 loss or 8.9 loss by the naira compared to the N97.11, which closed on Friday, December 29, 2023.
The naira recorded an intraday high of N1,130 per dollar and an intraday low of N744.50 per dollar, representing a wide disparity of N385.50 per dollar.
Data from NAFEM shows that Forex turnover at the close of trading was about $15.38 million, representing an 82% decline compared to the previous day.
In the parallel market, the naira fell to exchange at N1,220 per dollar, representing a 0.41% loss compared to the N1,215 it exchanged on December 29, 2023.
Naira sets another exchange rate record, closes the gap with the black market, World Bank makes prediction
Legit.ng reported that the Nigerian currency, the naira, set another historical record in the official market on Thursday, December 28, 2023, plunging to the lowest at N1,043.09.
The naira’s depreciation represents 16.35% compared to its previous closing rate, coming a few days before the end of 2023.
The Nigerian currency has remained one of the most volatile currencies in the world in 2023 after the Nigerian government announced a new foreign exchange reform in June this year.
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Source: Legit.ng
