The value of Nigeria’s money, called the naira, has gone down a lot. On October 14, 2024, you needed 1,700 naira just to get one U.S. dollar if you were buying it from the street. That’s what the people who sell and buy money told us.
Just a few days before, on October 11, the naira was worth a little more, needing 1,695 naira for a dollar. This happened even though the price of oil, which makes a lot of money for Nigeria, has gone up to over $80 for a big barrel.
When you look at the official way of buying dollars, the naira is a bit stronger there. It was 1,641.27 naira for one dollar. Still, that’s worse than before October 11, when it was 1,622.57 naira for a dollar.
The difference between the street price and the official price shows that Nigeria’s economy is having some problems with its money.
What’s Been Happening with the Naira
This whole year, 2024, the naira has been losing its value, over half of how much it was worth at the start of the year. In January, a dollar cost about 907.11 naira, but by October it was more than 1,500 naira for a dollar. In February, it was as bad as 1,616.53 naira, before getting a little better in March to 1,303 naira.
By April, it needed more than 1,100 naira for a dollar. It got even worse by September, needing 1,668.97 naira, and now it’s the worst at 1,700 naira.
Important Numbers
- On October 14, the naira started at 1,695 naira per dollar but went down to 1,700 naira.
- In the official market, the naira was 1,641.27 naira per dollar, which is worse than the previous rate of 1,622.57 naira.
- The price of the naira changed a lot in trading. Highest price was 1,675.00 naira and the lowest was 1,591.00 naira, settling at 1,641.27 naira.
- A lot more people wanted dollars, with trades reaching 616.73 million dollars compared to the day before, which was only 145.56 million dollars.
Why is This Happening?
The naira’s problems come from many places. Even though oil prices are high—which should help countries like Nigeria with lots of oil—the naira is still going down in value. It’s probably because there are not enough dollars, things are getting more expensive, and people need to buy dollars from the street instead of official places.
While Nigeria’s oil still sells for over $80, some people like James Tor, who is part of a group of people who sell petroleum, think petrol prices might go down. This is because the government lets people buy fuel from places like the Dangote refinery directly, so there might be less need to import it.
Looking Ahead
Even after the naira dropped past 1,700 for a dollar, it might get a little better. As the price of oil is going over $81, it might help stop everything from getting more expensive and make the naira look better.
New rules might make people want less foreign money, and this could help the naira move back to the 1,600 range. However, how the naira truly performs will depend on the whole economy, like how much everything costs and how many dollars are available.
As Nigeria deals with these problems, how well the government works to fix things will decide if the naira can get better or if it gets even worse.