ENUGU, Nigeria (VOICE OF NAIJA) – In an unexpected turn of events, the US dollar witnessed a significant plunge, with its value dwindling to a range between N805 and N790 within the parallel exchange market on a Tuesday in mid-August.
This sharp decline marked a stark contrast to its earlier exchange rate of N925 to N930 in the morning hours.
The downward spiral gained momentum around 4:00 pm on that day, as whispers of a potential intervention by the Central Bank of Nigeria (CBN) spread among Bureau De Change (BDC) operators.
This drastic depreciation of the dollar followed a pivotal meeting between President Tinubu and the acting Governor of the CBN, Folashodun Shonubi, on the preceding Monday.
The conclave triggered a chain reaction, as Shonubi outlined imminent plans to execute crucial strategies aimed at counteracting the naira’s decline. This declaration proved costly for currency speculators, who grappled with substantial financial losses as a result of the swift developments.
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Notably, at the Wapa forex market in Kano, the BDCs commenced buying the dollar at N875 and selling at N905. A closer examination of the Zone 4 BDCs market in Abuja unveiled the unsuspecting plight of money speculators who found themselves blindsided by the unfolding situation.
Meanwhile, the Investors and Exporters window painted a slightly different picture, with the dollar’s opening value at N789/$. It experienced fluctuations throughout the day, hitting a peak of N799/$ and a trough of N740/$, eventually concluding at N774/$—a noteworthy N10 increment from the previous day’s closing rate of N764/$.
As reactions rippled across the financial landscape, one money exchange operator expressed the belief that the dollar’s descent might persist, potentially causing further depreciation.
Unfortunately, many individuals who acquired the dollar at a higher rate now face the grim prospect of financial losses, a consequence of the rapidly shifting exchange rates.
The economic ramifications of this phenomenon are poised to reverberate beyond the immediate market, shaping the financial decisions of various stakeholders in the coming days.