Nigerias naira has lost ground on the black market only a few days after being devalued by the central bank in a bid to shore up government finances and stem a dollar shortage.
The naira was trading at around 400 to the dollar on Tuesday, compared to 380 on Friday, when the central bank allowed it to float freely.
Nigeria’s President Muhammadu Buhari has come under pressure to devalue the naira as the country’s economy has been hit hard by falling oil prices.
The naira had been pegged at199-199.5 to the dollar since February, but the central bank allowed it to float freely on Friday in a bid to ease a dollar shortage.
The move is expected to help shore up government finances and stem the decline of the naira, but it is likely to lead to inflationary pressures.
The devaluation of the naira will make imported goods more expensive and is likely to fuel social unrest.
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