Nigeria’s naira touches record low on devaluation fears
Devaluation speculations have sent Nigeria’s currency plummeting.
Despite government efforts to soothe concerns over a possible devaluation of the naira, it’s hit a new record low, with bond yields climbing sharply, after the suspension of the central bank governor last week.
The naira fell 0.3 per cent against the dollar on Monday, marking its sixth day of declines, to the record low of 166.01.
Bond yields rose to their highest since July, up 0.12 percentage points to 6.41 per cent.
Nigeria’s government suspended the well thought of Lamido Sanusi (pictured), after he disclosed that $20bn (£12bn) of the $67bn of oil sold between January 2012 and July 2013 had not been accounted for.
In 2009, Sanusi launched an inquest to clamp down on corruption in country's banking industry. The following year he was named Central Bank Governor of the Year by Banker magazine.
Corruption and graft are big problems in the oil rich country, although it remains a favourite for many investors.
But falling reserves and a precarious economy have seen the central bank intervene several times in the currency market, and this means a number of analysts are expecting a devaluation later in the year.
Sarah Alade, acting central bank governor, confirmed last Thursday only that it has “no immediate plans” to devalue the naira – not be the most comforting news for investors.