Nigeria’s currency – Naira – lost 10.2 per cent of its value in 2022, emerging as fifth among Africa’s worst-performing currencies 2022, a report by World Bank has revealed.
In its latest Africa’s Pulse report for April 2023, the US-based global lender stated that in 2022, Ghanaian Cedi was the worst-performing currency in Sub-Saharan Africa after losing 40 per cent of its value in the year.
Comparing the naira with other currencies in the subregion, the bank said: “Other currencies with significant losses last year include those of Sudan (23.6 per cent), Malawi (20.7 per cent), The Gambia (14.6 per cent), and Nigeria (10.2 per cent).”
It also pointed out that Ghana’s Cedi has lost 20 per cent of its value so far in 2023, in sharp contrast to the Naira which has appreciated by about 0.67 per cent to N750 per US Dollar at the black market this year.
World Bank noted: “Rising food and fuel prices, as well as the depreciation of the exchange rate, were the main drivers of inflationary pressures in the region—and, particularly, in countries like Ghana, Sudan, and Malawi.”
It, however, pointed out that the hiking of the monetary policy rate in Nigeria which increased its interest rate by 650 basis points during the review period has not translated to a reduction in the inflation rate.
The global lender attributed the reduced effectiveness of monetary policy to, among other factors, persistent supply shocks driving inflation, lack of central bank autonomy, and foreign exchange distortions that widened parallel market exchange rate and fiscal dominance.
Meanwhile, the Naira appreciated marginally against US Dollar on Thursday, exchanging for N463.25 at the investors’ and exporters’ (I&E) window, indicating an increase of about 0.11 per cent when compared to the N463.75 for which it exchanged to the Dollar on Wednesday.
(Eyewitness)
