The dollar index remained near its weekly high, while the Nigerian naira fell below a key support line. The local currency dropped below the N1,600/$ support level in the black market.
Market fundamentals indicate renewed demand pressure and an expanding supply gap, leading to another round of naira depreciation.
The naira’s value fell from N1,625 per dollar last weekend to N1,635/$ yesterday.
The local currency is under severe pressure this month, struggling to maintain the critical N1,500 support level, according to market indicators, despite slight improvements in some macroeconomic conditions in the Nigerian foreign exchange market.
Fundamentals suggest that if the local currency cannot maintain its current levels, it may decline towards N1,800/$. Even ardent supporters of free market economics may now doubt that the naira will strengthen to its March highs this quarter.
(Nairametrics)
