Naira Falls to N1,658/$1 as CBN Shocks Market With Further Rate Hike

By Adedapo Adesanya

The Naira depreciated to a new low against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, September 24, as the Central Bank of Nigeria (CBN) shocked the market with a further boost to interest rates.

At the official market, the domestic currency lost N95.82 or 6.13 per cent on the greenback to exchange at N1,658.48/$1 versus the N1,562.66/$1 it was transacted a day earlier.

The apex bank after the 297th meeting of the Monetary Policy Committee (MPC) announced another increase in its Monetary Policy Rate (MPR) by 0.50 per cent to 27.25 per cent, despite the market expecting a pause as inflation had cooled in the last two months.

Explaining the rationale, the CBN Governor, Mr Yemi Cardoso, said the move would further contribute to cooling the inflation, and said the bank would continue to utilise all tools at its disposal to help the economy.

FX supply to the market improved yesterday by 66.0 per cent or $66.15 million as the forex turnover for the session settled at $166.36 million, in contrast to the preceding day’s $100.21 million.

Equally, the Nigerian currency depreciated against the Pound Sterling in the spot market on Tuesday by N63.99 to wrap the session at N2,131.86/£1 versus the previous day’s N2,067.87/£1.

Similarly, against the Euro, the local currency weakened by N15.64 to sell at N1,778.07/€1 compared with Monday’s closing price of N1,762.43/€1.

Also, in the parallel market, the Naira performed badly against the Dollar on Tuesday as its value declined by N5 to quote at N1,670/$1 versus the preceding day’s N1,665/$1.

Meanwhile, the cryptocurrency market was majorly positive on an anticipated global monetary easing cycle as China joined all other major global economies in easing monetary policy to combat a slowdown in the economy.

Cardano (ADA) rose by 6.4 per cent to $0.385, Solana (SOL) jumped by 2.8 per cent to $150.32, Dogecoin (DOGE) gained 1.9 per cent to sell at $0.1096., Bitcoin (BTC) rose by 1.4 per cent to $64,138.92, Ripple (XRP) appreciated by 0.4 per cent to $0.588, and Litecoin (LTC) went up by 0.1 per cent to $63.58.

On the flip side, Ethereum (ETH) dropped 0.3 per cent to quote at $2,624.71, Binance Coin (BNB) decreased by 0.2 per cent to trade at $601.38, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.