The naira plunged to a record low of N925/$1 on the parallel market on Wednesday as demand for foreign currency outstripped supply.
This is the aftermath of liberalising the foreign exchange regime, which is a clear departure of what obtained during the President Muhammadu Buhari- led administration.
At a time during the last administration, the World Bank and other agencies, as well as experts in banking, finance and economy had at different times said having official and parallel value for the naira was hurting the economy and at the same time making a few privileged people pocketing billions of dollars without producing anything as they get the forex from the CBN at official rate and instantly sell same at the black market.
Recall that during his inauguration on May 29, 2023, President Tinubu had said, “Monetary policy needs a thorough house cleaning. 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.”
On June 14, 2023, the CBN abolished the segmentation of the forex market into different windows and told Deposit Money Banks to freely float the naira against the dollar and other international currencies.
Buyers and sellers of foreign currency in the official FX market were then allowed to quote their preferred rates, as against previous practice where CBN dictated rates.
Wittingly or unwittingly, naira has since continued on a free fall at the parallel market despite the move.
