The Senate has summoned the Governor of the Central Bank of Nigeria, Godwin Emefiele, to explain the reasons for the rapid depreciation of the value of the naira, Channels TV reports. It has also mandated its Committee on Banking, Insurance and Other Financial Institutions to assess the impact of CBN intervention funds meant to support critical sectors of the economy.
The Upper chamber is taking these resolutions after federal legislators considered a motion on the state of CBN Intervention funds and the free fall of the naira.
The sponsor of the motion Senator Olubunmi Adetunmbi bemoaned Nigeria’s economic challenges and calls for extraordinary measures to address them. As of Thursday morning, July 28, the naira was exchanging for more than N700 to a dollar in the parallel markets.
The naira has continued its downward fall as it is inching towards N700 per dollar on the Peer-to-Peer (P2P) market, selling at N685 against the US greenback.
Findings from the crypto P2P exchange reveal that it traded at N667.5 per dollar on Tuesday, July 26, 2022, as demand for forex surged amid scarcity. The P2P market is usually traded in small volumes and the unit of the exchange is the cryptocurrency USDT, which is a stablecoin pegged at 1:1 with the dollar.
It’s recall that Last week, the dollar hit the same parity as the euro, the first in 20 years and experts say this has sent other currencies tumbling in the international markets.
The strong showing of the dollar, experts predict, will set off an economic tsunami for weaker economies around the world whose currencies would further be eroded. Though, good for the US economy, the predictions are not really good for other countries, especially economies with strong economic ties to the US.