What does this mean to everyday people?
It is no news that the Naira is gradually losing its value.
Over the past few months, it has worsened beyond control despite all the tactics employed by the Central Bank of Nigeria.
This week, the exchange rate of the Naira to the United State Dollars has plunged beyond the 700naira/$ mark. Experts predict that if there is no worthwhile action from the CBN, it might even plunge further beyond the 1000 naira/$ mark this year.
Although the official rate may still show the Naira at the 450-500 naira/$, however, BDC operators will argue otherwise. Also, on the cryptocurrency P2P market, the rates have crossed the 700 naira/$ mark.
To curb the rising inflationary pressure and increase the inflow of FX into the Nigerian economy, the apex bank increased the interest rate to 14% in June 2022 but this move didn’t help in regulating the exchange rate.
One of the adverse effects of this appalling exchange rate is the inflation of goods and services, making it difficult to achieve basic needs they could afford before. For example; In the last couple of weeks, the prices of food produce has skyrocketed.
The Senate has resolved to summon the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, to explain to them in a closed session, some of the reasons for the unrelenting depreciation of the value of the naira.
This has also mandated the Senate Committee on Banking, Insurance, and Other Financial Institutions to assess the impact of the CBN intervention funds meant to support critical sectors of the economy.
#STATEAFFAIRS is a segment that gives you a quick rundown of various political and state issues as they happen in the most simple, subtle language. In this edition, we are looking at the devaluation of the Naira and its domino effect on the economy.
