Naira Ranks High in List of 19 Worst-Performing Currencies in the World for 2022
- A renowned economist, Hanke has released a list of 19 worst-performing currencies against the US dollar
- The list includes countries from Africa, Asia and South America, with Venezuela and Zambia leading the pack
- Expectedly, the Nigerian currency is ranked high on the list after dropping to a record low at the black market
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Nigeria’s currency has been ranked as the 11th worst-performing currency against the US dollar in the world and the fourth worst in Africa.
This is according to Hanke’s Currency Watchlist, computed by Steve Hanke and John Hopkins University.
According to the data, the Naira had lost 48.87% of its value against the US dollar as of September 2, 2022, compared to its value in January 2020.
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Also, it is revealed the Zimbabwean RTGS dollar, which has lost 99.33% of its value against the US dollar, is the second worst-performing currency in the world.
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Venezuelan Bolivar took the crown as the worst-performing currency, with a depreciation rate of 99.39%.
Methodology
According to Hanke, in determining the currencies' performance, the black and spot exchange market was used.
What does this mean for countries with the worst-performing currencies?
Financial experts believe that countries with worst performing currencies should expect the following;
- Reduction in foreign direct investment.
- Massive capital flight
- Increase inflation
- Reduced economic growth
- Reduced GDP (gross domestic product)
- Increase graduate unemployment
- Reduction in government’s expenditure on infrastructure projects
- Unstable prices of commodities make it difficult for any meaningful planning
- Reduction in trade volume
- Increase hardship in countries coupled with increasing crime rate etc.
Naira records biggest fall to US dollar at official market history, despite Nigeria’s rising foreign reserves
Legit.ng earlier reported that the Nigerian currency has dropped to its biggest low to the US dollar in the last seven months at the official market, and it could get worst in the coming months.
FMDQ securities data shows that at the official market, Naira on Tuesday closed at N430, which is a N4.25 or 0.99 percent devaluation from N425.75 posted in the previous market session on Monday.
The last time Naira was exchanged at N430 or above was Thursday, 30th December 2021, at the official market.
Source: Legit.ng
