Nigerian Naira’s Sharp Drop Nullified CBN’s Efforts to Bolster Home Currency by Selling Euros and USD’s

The ongoing depreciation of the naira, which recently saw the Nigerian naira named the worst-performing currency when it fell by more than 5% at once, negating the previous day's gains, reportedly occurred shortly after the intervention of the central bank, which injected between 80 and 1100 million euros.

Recent efforts by the Central Bank of Nigeria (CBN) appear to have hit an obstacle after falling to 2-month lows to strengthen the local currency. It is reported that the currency has further weakened, despite injections of $80 to $1,100 million into the foreign exchange market.

The recent Bloomberg report noted that the 5.1% drop in the naira exchange rate to 1,533.99 Nigerian currency washed out the entire effect of the 4% increase after the intervention of CBN. The report also mentioned that the central bank of Nigeria was caught selling the U.S. dollars three days before it increased liquidity in the foreign exchange market.