Naira Depreciation: Nigeria’s Currency Hits New Low Amid Fuel Price Hike
The Nigerian naira has taken a significant hit against the US dollar, with the exchange rate reaching a new low. The latest development comes as the Nigerian National Petroleum Company Limited (NNPCL) increased the pump price of Premium Motor Spirit (petrol) for the second time this month. According to FMDQ data, the naira weakened to N1625.13 per dollar on Wednesday, representing a depreciation of N63.37 compared to the previous day’s rate of N1561.76.
This latest depreciation follows a brief gain of N73.39 against the dollar on Tuesday. The naira’s decline has also been reflected on the black market, where it depreciated to N1895 per dollar on Wednesday from N1780 the previous day. The downward trend in the currency’s value comes as FX’s daily transaction turnover decreased to $170.60 million on Wednesday, down from $253.68 million recorded the previous day.
The fuel price hike, which saw the price of petrol increase to N1030 per litre from N898, is the second consecutive hike in September 2024. This development is likely to have a significant impact on the average Nigerian, who is already grappling with the effects of inflation and economic uncertainty.
The depreciation of the naira is a major concern for the Nigerian government, which is struggling to stabilize the economy. The country’s foreign exchange reserves have been dwindling in recent months, making it challenging for the government to maintain a stable exchange rate. The latest development is likely to have far-reaching consequences for the country’s economy, including increased inflation and reduced purchasing power for citizens.
As the situation continues to unfold, it remains to be seen how the government will respond to the crisis. In the meantime, Nigerians are bracing themselves for the impact of the fuel price hike and the depreciating value of their currency.
