Naira Depreciation Widens Exchange Rate Gap Amid Speculation

The Naira's depreciation has led to a widening exchange rate gap, with traders citing speculation and liquidity issues as primary factors. The official exchange rate stands at N1,355.25 per dollar, while the parallel market rate is N1,400 per dollar, resulting in a disparity of N44.75.

Analysts, including Dr. Muda Yusuf, link this trend to uncertainty surrounding policy implementation and a lack of liquidity in the retail segment.

Bureau de Change operators have expressed concerns about their reliance on inconsistent sources of diaspora remittances and private inflows, which further fragment the market. Gwadeb has called on the government to emphasize Naira appreciation to encourage domestic growth and improve fiscal discipline.

The Central Bank of Nigeria is pushing for reforms to enhance transparency and efficiency in the foreign exchange market, aiming for improvements by March 2026. The current situation highlights the need for better policy clarity and broader access to foreign exchange across market segments.