Naira Appreciates Against US Dollar at Black Market as Tinubu Plans House Cleaning at CBN

Naira Appreciates Against US Dollar at Black Market as Tinubu Plans House Cleaning at CBN

  • The Nigerian naira experienced a significant appreciation against major foreign currencies at the black market
  • This follows the announcement by President Bola Tinubu that there will be reforms to the forex policy
  • Tinubu's proposed forex policy includes measures to streamline the foreign exchange market

The Nigerian currency, the naira, responded positively to the announcement made by President Bola Tinubu in his inaugural speech on Monday, March 29, 2023.

Tinubu, in his address, emphasised the need to merge the different exchange rates into one.

The move is intended to attract foreign investors and promote economic growth in the country.

Tinubu exchange rate
Tinubu, in his inaugural speech, stated that he would unify Nigerian exchange rates. Photo credit: @bolatinubu
Source: Facebook

Nigeria operates multiple exchange rates, which many experts blame for the fall of the naira.

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Also, Economists and global institutions such as the International Monetary Fund (IMF) and the World Bank have long advocated this measure.

President Tinubu, in his message to Nigerians, stated:

"Monetary policy needs a thorough housecleaning. The Central Bank must work towards a unified exchange rate.
This will direct funds away from arbitrage into meaningful investment in the plant, equipment, and jobs that power the real economy."

Nigeria's exchange rate to dollar

The news of this proposed policy had an immediate positive impact on the value of the Nigerian currency, particularly in the black market and the peer-to-peer (P2P) segments of the foreign exchange (FX) market.

Checks show that in the parallel market, the naira experienced a significant appreciation of 1.69% or N13, to trade at N757/$1 compared to the previous session's rate of N770/$1.

Similarly, in the P2P window, the naira gained 1.29% or N10 against the US dollar, closing at N765/$1, compared to the previous session's rate of N775/$1.

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Nigerian Breweries blames CBN

Meanwhile, in another report, Nigerian Breweries (NB) disclosed that it experienced a decline in revenue of N10.71 billion in its Q1 2023 financial result.

The NB board attributed the drop in revenue to several challenges, including CBN's naira redesign policy.

The CBN announced the withdrawal of the old 1000, 500, and 200 naira notes in February, which led to a severe cash scarcity.


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