In the first half of 2024, the Nigerian currency depreciated by nearly 40%, making it the worst-performing currency during that period. Meanwhile, the Kenyan shilling appreciated by 20.7%, ranking it as the best performer. The depreciation of the Nigerian naira was primarily driven by U.S. dollar shortages. Naira Falls for 9 Straight Days The Nigerian […]
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‘Spraying’ Naira Notes Causes Depreciation, Warns Nigerian Anti-Graft Body
The Economic and Financial Crimes Commission (EFCC) has issued a warning against the practice of spraying naira notes at social events, emphasizing that it diminishes the dignity of the currency. In a recent post on its official X page, the Nigerian anti-graft agency urged residents to respect the naira and avoid ridiculing it. The EFCC […]
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Nigerian Securities Regulator: Crypto Exchanges Complying With Naira Delisting Directive
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Yuval Harari Criticizes Bitcoin, Naira Becomes World’s Worst-Performing Currency, and More — Week in Review
Historian Yuval Noah Harari criticized bitcoin, calling it a “currency of distrust.” The Nigerian naira has become the world’s worst-performing currency after erasing its early April gains due to ongoing foreign exchange shortages. Robert Kiyosaki warned of a potential collapse of the U.S. dollar if the BRICS nations launch a gold-backed cryptocurrency, predicting hyperinflation. Gold […]
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Cryptocurrency Exchange Kucoin Suspends P2P Services for Nigerian Naira
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Embattled Binance Discontinues Nigerian Naira Services — Users Urged to Convert NGN Balances
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Nigerian Users Criticize Binance for Imposing Exchange Rate Caps on USDT to Naira Transactions
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Nigerian Currency Plunges to New Low Versus the USD, Central Bank Governor Says Naira is ‘Undervalued’
The Nigerian currency reportedly plunged to a new low versus the U.S. dollar on the official market on Jan.25. Central Bank governor Olayemi Cardoso has said the naira is currently “undervalued” and that efforts are underway to rectify this.
Official and Parallel Market Exchange Rates Nearly Converge
The beleaguered Nigerian currency has plunged to a new low against the U.S. dollar on the official market, briefly falling to NGN1,398 per greenback on Jan. 25. According to a Reuters report, the naira’s new official record low saw it nearly converge with the parallel market exchange rate, which stood at NGN1,400:USD1.
This latest depreciation of the naira is a continuation of a descent that seemingly began immediately after Bola Tinubu succeeded Muhammadu Buhari as Nigeria’s president and removed former Central Bank of Nigeria (CBN) Governor Godwin Emefiele. Before that, the Nigerian central bank had kept the naira’s exchange rate versus the dollar fixed at just under NGN500:USD1.
Following the appointment of the new CBN leadership, the naira has steadily depreciated against major currencies on both the official and unofficial markets. Many Nigerian economy experts agree that the ongoing slide of the naira is mainly due to shortages of foreign exchange.
However, the current CBN governor, Olayemi Cardoso, recently told delegates attending the launch of an economic outlook report that the naira is in fact “undervalued” and efforts are now underway to help it realize its true value.
“We believe that the naira is currently undervalued and, coupled with coordinated measures on the fiscal side, we will expedite genuine price discovery in the near term. This coordinated approach will contribute to a more balanced and stable exchange rate,” Cardoso reportedly said.
According to a report in the Leadership, the Central Bank of Nigeria (CBN) is planning to take several steps to ensure that all foreign exchange inflows are returned to the central bank.
Meanwhile, Cardoso said he is hoping that some of the reforms being undertaken by the CBN will result in a consistent and stable exchange rate. Such an exchange rate will boost investor confidence and make Nigeria an appealing foreign direct investment destination.
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Do you agree with the CBN governor’s comments about the naira’s value? Let us know what you think in the comments section below.
Nigerian Central Bank Dismisses Old Naira Banknote and Cash Shortage Rumors
The Nigerian central bank has dismissed rumors suggesting that the previously demonetized naira banknotes are no longer legal tender. According to the bank, all banknotes it has ever issued remain legal tender and “should not be rejected by anyone.”
No Shortage of Naira Banknotes Says the Central Bank
The Central Bank of Nigeria (CBN) has dispelled ongoing rumors suggesting that the previously demonetized naira banknotes are no longer legal tender. The bank also rejected reports of cash shortages in major cities across Nigeria.
All Banknotes Issued by the Central Bank of Nigeria (CBN) Remain Legal Tender. #NairaBankNotes pic.twitter.com/x8WotrLp54
— Central Bank of Nigeria (@cenbank) November 8, 2023
In a statement issued on Nov. 8 via X (formerly Twitter), the bank said the laws governing its operations clearly state that all banknotes issued by the CBN “should not be rejected by anyone.” It added that CBN branches across the country have been told to continue issuing different denominations of both the old and redesigned naira banknotes.
Spearheaded by the then governor Godwin Emefiele, the Nigerian central bank’s demonetization process was started to ostensibly counter activities of parallel market foreign exchange dealers and currency hoarders. However, several local media reports at the time claimed the exercise was intended to derail then-presidential aspirant Bola Tinubu’s campaign.
CBN Warns Against ‘Panic Withdrawals’
As previously reported by Bitcoin.com News, the CBN’s attempt to demonetize old naira banknotes without injecting sufficient supply of the redesigned banknotes is thought to have caused cash shortages. After it initially refused to give in to the public’s demand for an extension of the deadline, the CBN eventually relented and the demonetized banknotes were made legal tender again.
Meanwhile, in its latest warning to entities and individuals who are rejecting the old banknotes, the CBN said:
“We wish to restate that all denominations of banknotes issued by the Central Bank of Nigeria (CBN) remain legal tender. In line with Section 20(5) of the CBN Act, 2007, no one should refuse to accept the naira as a means of payment.”
The bank also told the Nigerian public to guard against what it called panic withdrawals. It also encouraged the use of alternative modes of payment.
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