Naira hits N500 to $1 at the forward market
The naira has been hitting new lows on the over-the-counter spot and black markets since last month, after the Central Bank adjusted its official rate, implying a 15% devaluation. This was done to absorb the impact of an oil price crash triggered by the coronavirus pandemic.
The Nigerian currency touched over N430 per dollar on the black market this week for the first time since 2017, about 14% weaker than the official pegged rate.
The naira was quoted at N386.33 on the spot market on Friday.
In addition, at the forward market, the one-year non-deliverable contract surged past N500 per dollar this week.
Money market rates climbed to 35% today, following the debit from just 2% at the last session.
The Central Bank of Nigeria recently injected about N1 trillion stimulus to support the fragile economy and slash interest rates on soft loans to selected sectors of the economy, but it is yet to show how it plans to support such interventions.
The Federal Government of Nigeria has recently made a plea for about $3.4 billion in emergency financing from the International Monetary Fund to neutralize the negative impacts of the COVID-19 pandemic, coupled with low oil prices.
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