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Pressure Building on Nigeria as Naira Out of Step With Oil Peers

  • Forwards prices signal currency will drop 15% within 6 months
  • Central bank may have to abandon efforts to limit speculation
Updated on

Nigerian central bank Governor Godwin Emefiele is losing the battle to prevent the naira from going the way of other oil-dependent currencies.

After imposing trading restrictions in February to prevent dollars from fleeing the economy, importers have been unable to pay suppliers, a thriving black market has sprung up in foreign banknotes and teachers have gone unpaid. The naira has been stable over the past six months since the central bank introduced regulations to halt a 20 percent decline in the currency in the 12 months through Feb. 12 to a record low of 206.32 per dollar.