Nigerian Currency Plunges to All-Time Low Versus Dollar, Central Bank Revokes Licenses of two,700 Currency Exchanges

The change charge of the Nigerian foreign money versus the dollar not too long ago plunged to an all-time low of NGN860:USD1. The naira’s depreciation has been attributed to shortages of international change on the official market and the rising demand for foreign exchange. The Central Bank of Nigeria (CBN) stated it has revoked the licenses of almost 2,700 bureaux de change (foreign money exchanges).

Widening Gap Between Official and Parallel Market Exchange Rates

On July 20, the Nigerian foreign money reportedly hit a brand new low of NGN860 per greenback on the parallel market. The foreign money’s fall widened the hole between the so-called import and export weighted average rate (NGN773:USD1) and the speed supplied by black market sellers.

According to a Reuters report, the foreign money’s plunge adopted the Central Bank of Nigeria (CBN)’s determination to drift the naira, which was made shortly after Bola Ahmed Tinubu’s inauguration because the Nigerian president. The report added that the naira’s depreciation got here per week earlier than the CBN financial coverage committee’s subsequent assembly.

Nearly 2,700 Currency Exchanges’ Licenses Revoked

As reported by Bitcoin.com News, the CBN initially devalued the naira by 30% earlier than permitting the foreign money to regularly depreciate in opposition to the dollar and different main currencies. Some Nigerian financial specialists prompt that the central financial institution’s final aim is the unification of the parallel and official change charges.

However, the scarcity of {dollars} within the formal market coupled with the rising demand for foreign exchange has elevated stress on the naira.

Meanwhile, in an try to halt the foreign money’s slide, the CBN reportedly introduced on July 20 that it had revoked the licenses of two,698 bureaux de change. According to an area report, the choice to withdraw the licenses is a part of measures adopted by the central financial institution which search to curtail or restrict the foreign money exchanges’ affect on the naira-to-dollar change charge.

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