By Emeka Anaeto, Economy Editor
LAGOS — Amidst a three-day straight slide in the exchange rate of Naira against
US Dollar, the Central Bank of Nigeria (CBN) has said that it would not bow to
pressures to further devalue the local currency.
Yesterday, the parallel market segment of the foreign exchange market traded
one US dollar to N245 after it opened the day at N242/USD1.00. The exchange
rate on Tuesday was N240 and N238 on Monday.
Dealers in the parallel markets expressed fears that at the on-going speed of s
lide the exchange rate might hit the N250/USD1.00 low by next week.
But reacting to the development, CBN’s Director of Corporate Communications,
Mr Ibrahim Muazu, told Vanguard that there was no need for panic at the
development, adding that it could be just a temporal reaction to the policy
change.
While defending the recent foreign exchange measures taken by the apex bank
to shore up the dwindling foreign reserves, Muazu said the apex bank would not
be pressured into further devaluation of the local currency which he said was the
intent of some sections of the foreign communities.
He stated the parallel market cannot trigger any economic crisis since all major
foreign exchange demands for eligible imports go through the official exchange
market which has not only remained stable but has been fully supplied by the
apex bank so far.
Bureau de Change (BDC) operators said huge demand for foreign exchange
began to inundate them as well as the black market as a result of the CBN’s shut
off of 41 items from the official market three weeks ago.
But Muazu denied this assertion, stating that CBN’s findings was that the supply/
demand gap being experienced in the parallel market was as a result of supply
shortages in that segment following the plugging of loopholes from the official
markets that had hitherto leaked into parallel market through round tripping.
He also said other economic crimes such as money laundering were major
drivers of what is happening in the parallel market today.
President of BDC Operators of Nigeria, Aminu Gwadabe, had given reasons for
the steady decline in value of Naira in the parallel market to include “over
regulation of the bureau de change and financial markets, increased naira
liquidity chasing fewer dollars, intensified hoarding and speculative activities,
inability of banks to meet legible and legitimate demands and tightening policies
of CBN.”
However, Vanguard interactions with some of the parallel market dealers,
yesterday, indicated that most of them have been driven by speculations that the
country was cash strapped in foreign currency, hence they are hiking the
exchange rate on fears of long term real scarcity.
On the other hand, some speculators are taking positions against possible
devaluation in the face of continued pressure on the apex bank from both within
and outside the country
http://www.vanguardngr.com/2015/07/we-wont-bow-to-pressure-to-further-devalue-naira-cbn/

Mr central bank Governor. You can't do nothing about it.

This is not about bowing to pressure. Even food stuffs and other market items has been on the increase since may29th. There's nothing you can do about it.

Only if it will stand its ground.

The capitalists are only concerned of profit maximization without any thought of its implications on others especially the fixed income earners, SMEs and the Security markets.

Wow, this is goodnews

hope it doesnt get worse,nw whr ar those wu preachd of 1$ to #1......they don con us

With MuRAMadu Buhari on the throne, you will bow o

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