Nume Ekeghe

The Africa Economist/Managing Director, Citi Bank, Mr. David Cowan has predicted a further devaluation of the naira, arguing that the value of the country’s external reserves is too low to sustain the defence of the currency.

Specifically, Cowan said the Central Bank of Nigeria would once more devalue the naira towards the end of the year.

He stated this yesterday at the EuroFinance conference in Lagos.

Cowen said: "What the central bank is battling is to the extent and how much the naira has to adjust. At the moment, the central bank thinks that the naira has adjusted enough, while market doesn't think the naira has adjusted enough."

He believes the apex bank does not want the forex reserves to decline further than its present value. External reserves stood a $29.031 billion as at Monday.

He added: "I still think we are going to see an adjustment to the naira. The fiscal and current account deficit tells us that a lack of real return and I think it is also in the bottom-line they haven't got the reserves in defending the naira. But there is still a long period in this stand-off which would last maybe three four months or longer.

"Whatever happens, I still think that the exchange rate would end up around N220/$1 late 2015, he added.

Responding to questions on the Nigerian economy, on the sidelines of the event, he said: "Nigeria built up a lot of savings for a rainy day, and then it ran those savings down in the last years. When it got hit by an oil price shock, it doesn't have much money that allows it to make a more gradual adjustment that is why the naira came under pressure.”

Furthermore, he said: "The long term solution is to let the naira adjust. If you let the naira adjust, it will increase the amount of revenue going to the government which would help it control its fiscal spending. Yes it would push inflation in the short term but hopefully that should also drive a production response from the agriculture sector."

He also urged the new government to focus on power, pointing out that electricity has the potential to transform this country.

Source:http://www.nairausd.com/2015/06/nigerias-forex-reserves-too-low-to.html

@lalasticlala
@Barcanista
@Ishilov

Exchange Rate for Dollar-Naira, Wednesday 24th June 2015

http://www.nairausd.com/2015/06/exchange-rate-for-dollar-naira_24.html

The economic managers should allow the Naira to fall to its real value and then work our economic plans to bring it to sanity. This method of naira defence don't seem to be having long term positive effect. We need to fix the real sectors and improve the manufacturing and other sectors of our economy.

barcanista:
The economic managers should allow the Naira to fall to its real value and then work our economic plans to bring it to sanity. This method of naira defence don't seem to be having long term positive effect. We need to fix the real sectors and improve the manufacturing and other sectors of our economy.

Our Gov. know the real problem of the Country but are not ready to solve it due to their personal gain.

My brother, every year we keep having the same problem. Why won't our naira continue to fall when we continue to import than produce? Why won't it fall when we continue to allow foreigners to be paid in dollars instead of naira? Why won't it fall when some merchants accept payment in dollars? Why won't it fall when the rich people will rather operate dollar account and ship dollars abroad than saving in naira in Nigeria?

ifyan:


Our Gov. know the real problem of the Country but are not ready to solve it due to their personal gain.

barcanista:
My brother, every year we keep having the same problem. Why won't our naira continue to fall when we continue to import than produce? Why won't it fall when we continue to allow foreigners to be paid in dollars instead of naira? Why won't it fall when some merchants accept payment in dollars? Why won't it fall when the rich people will rather operate dollar account and ship dollars abroad than saving in naira in Nigeria?

Just One day bro.

ifyan:


Our Gov. know the real problem of the Country but are not ready to solve it due to their personal gain.

l swear corruption is the bane of Nigeria's development.
If corruption can be rooted out or at least drastically reduced, every other section of the economy will fall into place.

Defcon1:

l swear corruption is the bane of Nigeria's development.
If corruption can be rooted out or at least drastically reduced, every other section of the economy will fall into place.

Should I say supported or love this.

It's better to have funds in goods than in bank account economic-wise