By: Jeremiah Nutsugah
According to a Bloomberg report on Friday, June 28, the Nigerian Naira has been identified as the worst-performing currency globally in the first half of 2024.
As reported by Bloomberg, data from FMDQ showed that the Naira weakened for the ninth consecutive day, reaching ₦1,510 per dollar by Thursday, June 27. The currencies of Egypt and Ghana also ranked among the worst performers.
This losing streak, the longest since July 2017, has resulted in a 40% decline in the Naira’s value since the start of the year. Years of acute foreign exchange scarcity and instability, caused by lower crude production and a lack of economic diversification, have been the primary causes.
The local unit has lost approximately 70% of its value against the dollar since June 2023. PricewaterhouseCoopers Limited (PwC) reported in its latest economic report on Nigeria that the Naira plummeted by 67.8% against the dollar, from an average of ₦461.1 in May 2023 to ₦1,433.80 in May 2024.
Despite foreign exchange market reforms by the Central Bank of Nigeria aimed at achieving price discovery and attracting liquidity to the market, the depreciation occurred.
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Bloomberg’s latest report also noted that the currency experienced volatility between mid-April and May due to an imbalance in demand and supply for the dollar, but the trend halted with an improvement in dollar inflows in June.