The shift of general elections effects not only political life of the country, but also Nigeria’s economy. The country’s national currency hit another record low.
The naira recoiled as much as 1.5 percent to 199.10 per dollar before cutting losses to trade at 199.01 by 11:12 a.m. in Lagos.
“Traders are seeing higher uncertainties in the market with the postponement of the election,” Lanre Buluro, head of research at Primera Africa Securities Ltd., told Bloomberg.
“There is speculation on the naira with many buying dollars in anticipation of imminent devaluation before the election or after.”
The country’s stock index is now also the worst performer in the world this year.
Both, the naira and stock index, along with government promises, are set to weaken more after Nigeria delayed elections, according to banks and brokers including Renaissance Capital and Standard Chartered Plc.
Nigeria’s currency has dropped 15 percent against the dollar on the interbank market in the past three months, the most among 24 African countries tracked by Bloomberg. It fell for sixth day, down 1 percent to 195.95, a record low.
Central bank of Nigeria has condensed foreign-exchange assets to a three-year low in a bid to protect the naira with dollar sales.
In November, policy makers weakened the midpoint of the official exchange rate to 168 per dollar from 155 and raised the benchmark borrowing cost to a record 13 percent.
