Naira tumbles by 51.95% despite CBN’s defence measures

The value of the naira to the dollar fell from 196.99 in December 2015 to 410 in April 2021, reflecting a 51.95 per cent decline despite the various foreign exchange policies introduced by the Central Bank of Nigeria to strengthen the currency.

According to a monthly document obtained from the CBN’s website, the value of naira at the inter-bank forex market stood at N196.99 as of December 2015.

The PUNCH had reported last month that the CBN officially adopted the NAFEX exchange rate of N410.25/$1 as its official exchange rate, devaluing the naira from N379/$.

In a move to achieve exchange rate stability and preserve the country’s forex reserves, the CBN in 2015 reviewed downwards the spending limit on the usage of naira-denominated debit cards for transactions abroad.

In a circular issued in April 2015 signed by the then Director of Trade and Exchange, Olakanmi Gbadamosi, the bank said the limit had been reduced from $150,000 to $50,000 per person annually, while daily cash withdrawals per person was pegged at $300.

After six months of implementing the policy, the value of naira in the official window remained stable at 197/$, but fell from 210/$ to 258/$ at the parallel market.

In June 2015, the CBN announced that it was stopping the supply of forex to 41 items that could be easily produced in Nigeria, a development that brought about the forex exclusion policy.

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