A report by Bloomberg says the naira is one of the world’s four worst performing currencies in 2016.
The seven best performing currencies of the world
- The Russian ruble
- The Brazilian real
- The palladium
- The Iceland krona
- The Zambian kwacha
- South African rand
In terms of spot returns, they appreciated by 21.31 per cent, 20.96 per cent, 20.08 per cent, 14.42 per cent, 14.41 per cent, 11.96 per cent and 11 per cent respectively.
The four worst performing currencies in 2016
- The Egyptian pound
- Suriname dollar
- Venezuela bolivar
- The Naira
The Egyptian pound, Suriname dollar and Venezuela bolivar’s currency spot returns dropped by 58.84 per cent, 46.68 per cent and 37 per cent, respectively, for the period.
The naira was said to have lost 36.68 per cent of its spot returns for the year,
The Bloomberg report stated: “It was a particularly bad year for any currency called the ‘pound’. The Egyptian version was the worst performer in 2016 as the nation took the dramatic step of allowing it to trade freely in an attempt to stabilise an economy struggling with a dollar shortage and concerns over social unrest. Britain’s pound tumbled after the Brexit and never recovered.”
On the other side of the spectrum, digital currency, bitcoin, was the best performer this year, rising more than 100 per cent as capital controls in places like China and isolationist rumblings in the United Kingdom and the United States fuelled interest in alternate currencies, according to the report.
It added, “When it comes to currencies issued by governments and central banks, the Russian ruble has been the best performer of the year as the oil market rebounded.
“While the UK currency’s slide didn’t match those in some emerging markets, it did tally the worst performance among major currencies.”
The Nigerian equity market fared worst in the year, according to the report, as the nation’s economy is set to contract in 2016 for the first time in more than 20 years as capital controls deter foreigners from investing and militants are blowing up pipelines.
Despite recent unrest, Brazil’s Ibovespa stock index remained the best performer for 2016 when looking at all indices in terms of the US dollar. This was largely due to hopes that President Michel Temer, who took office after Dilma Rousseff was impeached, would end the worst recession in a century and bring about political stability.