The naira Thursday depreciated to N385 per dollar in the official market.
The local currency, which exchanged at N361 to dollar the previous day, has continued to come under pressure as news of government’s plan to leave exchange rate to market forces broke.
But the naira remained marginally stable at the parallel market, depreciating to N453 to a dollar, as against N452 to a dollar that was exchanged the previous day.
The International Monetary Fund, had consistently advised the Central Bank of Nigeria (CBN) to adopt a flexible exchange rate regime to stop inflation rise.
The inflation rate has been upbeat in recent months as the impact of the Covid-19 pandemic reflects on the economy. Inflation increased by 12.40 percent (year-on-year) in May 2020.
This is 0.06 percent points higher than the rate recorded in April 2020 (12.34) percent. On month-on-month basis, the Headline index increased by 1.17 per cent in May 2020, this is 0.15 percent rate higher than the rate recorded in April 2020 (1.02) per cent.
This was despite the sustained upward pressure on consumer prices as headline inflation rose 1.2 per cent mont-on-month from one per cent, the highest since June 2018. Notably, core inflation rose faster by 14 basis points to 10.1 per cent year-on-year from 10 per cent in April 2020, the highest since July 2018.
However, core inflation increased five basis points slower at 0.9 per cent on a month-on-month basis, the first moderation since February 2020. Meanwhile, food inflation was little changed at 15.04 per cent year-on-year from 15.03 per cent in the previous month.
