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Nairaland Forum / Nairaland / General / Business / CBN Floats The Naira, The Implications For You And I (78703 Views)
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Re: CBN Floats The Naira, The Implications For You And I by yusufu16: 4:13pm On Jun 15, 2016 |
I think there is light at the end of the tunnel. 4 Likes |
Re: CBN Floats The Naira, The Implications For You And I by Adminisher: 4:14pm On Jun 15, 2016 |
Meringe: It is extremely stxxid to say policy somersault caused Naira crash. The economy is not an egg. I don't know why people think there is a magic formulas for economic recovery. There is no such thing. This measure is the best I have seen so far. Nigerians are highly innovative and hardworking. Did I use the words "innovate" and "hardwork" ?. OK I did. That is the way to succeed in Nigeria now. The FG has made it easy now. Let me put it simply , it is now much cheaper to produce jeans in Nigeria than China even with the generator you will run and everything. Nigeria has no winter, it is also one of the few countries you can harvest some crops twice a year. 11 Likes 2 Shares |
Re: CBN Floats The Naira, The Implications For You And I by Nobody: 4:15pm On Jun 15, 2016 |
adebrave1:True. Everyone is now behaving as if they graduated from Harvard Business School. Pretenders all over nairaland 3 Likes |
Re: CBN Floats The Naira, The Implications For You And I by erico2k2(m): 4:15pm On Jun 15, 2016 |
designking:What you talking about?he just devalued the naira. Is this not what we ha e been saying all along 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by Nobody: 4:16pm On Jun 15, 2016 |
Guyman02: Wonderful international politics. What caused the emergence of Eastern Libya as an independent state? 2 Likes |
Re: CBN Floats The Naira, The Implications For You And I by erico2k2(m): 4:16pm On Jun 15, 2016 |
Adminisher:I believe by Monday you will change to a different school of thought. Let's wait . |
Re: CBN Floats The Naira, The Implications For You And I by mengho(m): 4:19pm On Jun 15, 2016 |
Pls gurus in d house should elaborate this thing. Some of us are just simple middle scale commercial farmers. How will this affect the common Nigerian man who use naira & a bit of dollar |
Re: CBN Floats The Naira, The Implications For You And I by Tamaris1: 4:20pm On Jun 15, 2016 |
Buhari is clueless, inept and confused! Buhari is a punishment to Nigerians for our sins!! 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by agitator: 4:20pm On Jun 15, 2016 |
davide470: 1. CBN go sell dollars to the banks for market price. In other words cbn to find out wetin aboki dey sell then sell close to that price. 2. Dem go create new set of dealers wey go dey between the CBN and banks. 3. If Hilary Clinton won bring money come start akara business for 9ja, the new set of dealers go buy the dollars from her then sell to banks at the market rate she ready to sell. before she go transfer the money come then bank go give her N199 naira for $1 but when she want to take any money out, banks go sell $1 for N330. (before this 1 na real 419 na-im make oyibo no gree come do business for 9ja) 4. People wey dey export goods like starch, garri, palmwine go fit buy dollar if dem need am for the price wey bank dey buy from each other. before banks dey show how much dem ready to buy dollars and how much dem dey sell, but when bank want to buy from another bank, the bank dey remove small for the other bank so dem fit make small gain too. 5. the 41 items we federal government bin ban still remain ban. Pesin no fit buy dollar for the price CBN or their dealers dey sell to bank to order for these item. but no wahala because the price difference no go much maybe between $2~$5. So this one no get real meaning. 6. You fit pay for dollars then in future collect you dollars for the rate of that day. Example today na 14 Jun and if dem day sell dollar N350 you fit pay for am then for September if dollar dey sell for N450, you go still collect the dollar for N350, this one be like saving you dollars. 14 Likes 2 Shares |
Re: CBN Floats The Naira, The Implications For You And I by Pavore9: 4:20pm On Jun 15, 2016 |
erico2k2: Whatever it ends up at will not bother me because am linked to local production and export earning FX. 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by 2rutalk1: 4:20pm On Jun 15, 2016 |
okirahaj:. Floating the naira means the value of our naira will henceforth be determined by the interplay of demand and supply. The CBN will no longer fix the exchange rate, though the CBN will intervene from time to time. Meanwhile, since we are maintaining a Single Window System, you and I can walk into any Commercial Bank and buy dollars at their own rate depending on demand and supply of the currency. It also means that black Marketers (Mallams) will no longer have enough patronage since buying from the commercial banks will now be easier. However, floating exchange rate regime can be counter productive in an economy that is riddled with stagflation (Inflation + unemployment) like Nigeria because it stifles FDI in the long run. 4 Likes |
Re: CBN Floats The Naira, The Implications For You And I by MrDoGood(m): 4:21pm On Jun 15, 2016 |
davide470: I DON'T UNDERSTAND PLEASE EXPLAIN |
Re: CBN Floats The Naira, The Implications For You And I by macherie1: 4:21pm On Jun 15, 2016 |
And the plot thickens. Why would CBN throw everyone to the interbank market when we know banks are only after the profit? In a country with so many greedy people like Nigeria, competiton rarely puts downward pressure on prices. The implication of this is that the rate of dollar will rise astronomically in the coming weeks since a very high demand has been automatically placed on greedy Nigerian banks. Wether the rate will decrease anytime soon is unknown. 4 Likes |
Re: CBN Floats The Naira, The Implications For You And I by Johnnoo(m): 4:26pm On Jun 15, 2016 |
This present administration doesn't know what they are doing. Finally they have reverted to initial status quo . The use of trial & error economy (which is directly impacting on the lives of the citizens of Nigeria) is very very unfair... |
Re: CBN Floats The Naira, The Implications For You And I by blackpanda: 4:26pm On Jun 15, 2016 |
truthspeaks: If u cant understand simple economis even after they broke it down for u, then its best u shut up and stop displaying your ignorance. All u know how to do is insult |
Re: CBN Floats The Naira, The Implications For You And I by jpphilips(m): 4:28pm On Jun 15, 2016 |
Guyman02: What has this got to do with the subject? you see why Buhari is justified to call you anything anywhere because your brain is still on hire purchase, NONSENSE!! 2 Likes |
Re: CBN Floats The Naira, The Implications For You And I by designking: 4:28pm On Jun 15, 2016 |
erico2k2:The naira has never been rightly valued. You can't just determine the value of a currency by politically pronouncing a value. The true price of a currency should always be determined by the forces of demand and supply (True Market). The current government is setting things right, and that may mean taking us back to the fundamentals or foundations, which is usually a lower state or starting stage. Many stats, ratings and figures previously bandied about by past governments are mostly fictitious and fraudulent. How Will This Affect You and I Dollar is not our national currency, there is too much attention given to dollar because of the make-shift value attached to it. Our politicians spends dollars and stockpile their funds in dollar because they believe it is scarce and heavily hoarded. With a very volatile and liquid forex market, you wouldn't want to keep your funds in dollar if you are not an FX trader, because it becomes ever changing with the tick of the second. You can lose a sizable percentage of your income if you keep your funds in dollars. The CBN don't protect the dollar but the naira, with improving trade balance, the dollar will gradually weaken and find a base price, that is stable and regular. 13 Likes 3 Shares |
Re: CBN Floats The Naira, The Implications For You And I by idupaul: 4:30pm On Jun 15, 2016 |
FredN: Same thing you said about fuel and electricity |
Re: CBN Floats The Naira, The Implications For You And I by Nobody: 4:30pm On Jun 15, 2016 |
Adminisher: The golden rule to investing is KNOW YOUR MARKET POLICY INCONSISTENCIES made investors wary of investing in Nigeria in the last 1 year No matter how innovative you are, you will be foolish to start making jeans if you are not sure if the government will ban jeans tomorrow morning 3 Likes |
Re: CBN Floats The Naira, The Implications For You And I by Iko5000: 4:30pm On Jun 15, 2016 |
Please can someone confirm the last time that Naira was determine by market forces , was it in the seventies or just before 1983.[size=15pt][/size] |
Re: CBN Floats The Naira, The Implications For You And I by seunt4ut(m): 4:31pm On Jun 15, 2016 |
Them go use big big English daburu everything. Them go dey cause confusion confusion upression inflation paaaan raran |
Re: CBN Floats The Naira, The Implications For You And I by truthspeaks: 4:32pm On Jun 15, 2016 |
e pain am. Evry1 ain't like zombies. I understand evry bit of wats written thr n it simply means devaluation of d naira. D word wasn't used so as to save ur bubu's face. Or probably if we r wrong y not prove us right if u r so intelligent to engage in such conversation. Dundi olodo blackpanda: |
Re: CBN Floats The Naira, The Implications For You And I by davide470(m): 4:32pm On Jun 15, 2016 |
MrDoGood:It means the FX rates would work like a stock market; demand and supply, but there would be an oversight authority (primary dealers) providing liquidity for the market. |
Re: CBN Floats The Naira, The Implications For You And I by Meringe(m): 4:32pm On Jun 15, 2016 |
Adminisher:I can't use insulting words on you. But if you feel that we are better off with higher exchange rate because we can produce here cheaper as your argument, then why don't the CBN allow the naira to crash to #1000? In your mind, you think dollar controls only the price of finished imported goods? You must be joking. If you are following the rise of dollar against naira since last year, it has been as a result of CBN annoucments of some of their introduced polices. Have you asked yourself why naira still depreciates even when crude oil price is on the rise? Be informed. |
Re: CBN Floats The Naira, The Implications For You And I by Guyman02: 4:32pm On Jun 15, 2016 |
jpphilips: One of our major problems is that we dont take time to study international politics, it has effect on your own economy, because of the crisis in Libya Boko Haram gets their weapons from there and this has affected our economy; I want to show you the link but you are too ignorant to understand. Ngozi Okonjo Iweala is an icon because she understands international economic politics which our beautiful Kemi Adeosun is still studying. 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by macanu(m): 4:33pm On Jun 15, 2016 |
wellmax:tell ur president to stop talking from both sides of his mouth,after refusing to devalue now go backs to his vomit.confusion everywhere 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by LordIsaac(m): 4:35pm On Jun 15, 2016 |
Did anyone observe that non of our so called economists and accountants could break the simple theory down to a lay man.....Yet, if you asked them, they'd say they graduated from Covenant with a first class!! 1 Like |
Re: CBN Floats The Naira, The Implications For You And I by happney65: 4:36pm On Jun 15, 2016 |
joseph1013: omolola15 come and see..the same thing he said he wont do he eventually did after destroying everything.. WU and MG sef don dey give us 300naira per dollar..The highest so-far in the History of this Nation..Oya continue...Eyin weeere |
Re: CBN Floats The Naira, The Implications For You And I by NancyAgolokigho(f): 4:36pm On Jun 15, 2016 |
Let's stop castigating and just wait till Monday. |
Re: CBN Floats The Naira, The Implications For You And I by docadams: 4:37pm On Jun 15, 2016 |
anonimi: Or, worst still, GEJ import waiver |
Re: CBN Floats The Naira, The Implications For You And I by Marpol: 4:37pm On Jun 15, 2016 |
ABUJA, June 15 (Reuters) – Nigeria’s central bank will open a “purely” market-driven window for interbank foreign exchange trading, shifting away from a fixed exchange rate, in an effort to increase the supply of hard currency, the governor of the bank said on Wednesday. The central bank will use the new trading scheme to inject foreign exchange liquidity, if needed, which Nigeria hopes will ease severe dollar shortages caused by a slump in oil revenue, Governor Godwin Emefiele said. It was not clear at what rate the central bank would supply dollars to the interbank market. The central bank’s official rate is 197 naira to the U.S. dollar, but the currency trades at around a 50 percent discount on the parallel market. Letting the market set the naira’s value is likely to drive down its value. That will make Nigerian products cheaper and competing imports more expensive, which should stimulate the domestic economy. “The market shall operate as a single market structure through the interbank and autonomous window. The exchange rate will be purely market-driven,” Emefiele told reporters. “To improve the dynamics of the market, we will introduce foreign exchange primary dealers who would be registered by the CBN to deal directly with the bank for large trade sizes on a two-way quote basis,” he said. Investors approved of the idea: Nigeria’s stock market gained 3 percent following the announcement. “Its a pretty important step in the right direction,” said Alan Cameron, an economist at Exotix in London. “Basically it amounts to a managed float, which is better than what most people were expecting. It’s a pleasant surprise.” Emefiele also said the central bank will open a foreign exchange futures market to ease demand on spot trading, reduce volatility and give businesses more certainty. Precise guidelines will be published later on Wednesday, he said, adding that the new window would have eight to 10 primary traders handling minimum volumes of $10 million. Africa’s biggest economy, which contracted by 0.4 percent in the first quarter, faces its worst crisis in decades after the decline in oil prices and last year’s introduction of a currency peg that prompted large-scale capital flight. “Over the long run, a weaker currency will help Nigeria’s economy by encouraging import substitution and attracting foreign investors, who have shunned the country for fear of a devaluation,” said John Ashbourne at Capital Economics. “But the move will be painful over the short term. Higher import prices will add to inflation … This will probably force the authorities to tighten monetary policy.” (Additional reporting by Alexis Akwagyiram, Chijioke Ohuocha, Sujata Rao and Camillus Eboh; Editing by Larry King) 2 Likes 1 Share |
Re: CBN Floats The Naira, The Implications For You And I by marv1: 4:39pm On Jun 15, 2016 |
designking:But nigeria is a mono economy. The oil production has reduced drastically with recent bombings by militants. What else do we have that we can exchange for dollars. Nothing. So the floating of naira is still devaluation if govt is going to allow one window, allow buy and sell freely. We use dollars for virtualy everything because we dont produce. So we cant earn more on dollars. They should spare us the sermon. 1 Like |
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