Nigeria's Naira plunges to record low of 345 to the US dollar

Nigeria’s Naira suffered its biggest daily depreciation against the dollar on Monday as the exchange rate rose to N345 per dollar in the parallel market.

Official rate however remained at 197.50 to the dollar at the close of trading on Monday.

The naira has been on steady decline since January 12th, when the Central Bank of Nigeria (CBN) stopped weekly dollar sale to forex bureaus. Prior to this action, the naira traded at N265 per dollar in the parallel market.

Consequently, pressure is now building on the government to devalue the official exchange rate to narrow the gap and spare Nigerians from huge bills for imported goods.

Tumbling global oil prices have battered Africa’s top crude exporter, with foreign exchange reserves down to an 11-year low at $27.85 billion by mid February.

Nigeria’s government is concerned that further depreciation will hurt poor Nigerians, but the bank’s refusal to revise the pegged exchange rate has widened a chasm between official rates and the parallel market.