The Nigerian currency, naira, is one of the world’s worst-performing currencies, after Ghana’s cedi and the Sri Lankan rupee, a Bloomberg report says.
According to the report, though the naira was performing pretty well against the dollar at the official market, ordinary Nigerians are grappling with a 37 per cent drop in the widely-used black market, where the exchange rate of the local currency is largely determined by the level of demand for the dollar.
“While the naira officially closed at 442.75 to the dollar on Friday, currency traders on the streets of Lagos, Nigeria’s commercial hub, quoted the greenback at 890 naira, according to Umar Salisu, a bureau de change operator who tracks the data,” Bloomberg says.
Bloomberg explained that the naira’s depreciation in the black market started a day after the Central Bank of Nigeria announced that it will issue redesigned 200-, 500- and 1,000-naira notes from mid-December in a bid to mop up excess cash in circulation.
The report said the naira’s poor performance against the dollar makes it the worst among the 148 currencies tracked.
This is coming two months after the Hanke Currency Watchlist ranked the naira the third in Africa and the 11th worst-performing currency in the world.
According to John Hanke, a professor of Applied Economics at the John Hopkins University, the value of the naira has depreciated against the US dollar by 48.87 per cent since January 2020.
