Nigerian Currency Hits All-time Low, Senate Blames Central Bank Chief
2022.07.28 20:09
Nigerian Currency Hits All-time Low, Senate Blames Central Bank Chief
- The Nigerian currency, the naira hits a record low of 695 nairas per dollar on the black market.
- The Central Bank Chief is being held responsible for the cause, says the Nigerian senate.
- Senate plans to question Godwin Emefiele, Governor of the Central Bank.
On Wednesday, it was reported that the naira, the Nigerian currency was free falling, hitting a record low of 695 nairas per dollar on the black market.
According to sources, Nigeria’s senate passed a motion on Wednesday to call for Central Bank Governor Godwin Emefiele over the crash of the naira and urged them to take immediate action.
The senate plans to question Emefiele on the impact of cheap loans granted by the central bank to particular sectors of the economy to boost local production in an offer to cut imports.
However, there was no confirmed date for the meeting held by the senate committee on banking. The central bank is yet to respond to the request.
Moreover, based on research, the reason why the naira crashed was due to the lack of dollars in the parallel market.
Recalling July of last year, since the pandemic, Nigeria’s currency worsened after foreign inventors left as oil prices yielded. The oil prices are back to normal, but the investors are gone forever.
According to sources, one lawmaker criticized the central bank’s decision to cease dollar sales to currency exchange businesses and said that the move is one of the reasons for the dollar scarcity.
The Central Bank of Nigeria (CBN) stopped forex sales to retail currency traders to calm pressure on reserves and sustain the official market.
This action caused direct demand for the unofficial market. The senate president said in a statement:
The policy had contributed to the excessive scarcity of forex in Nigeria.
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