AreaFada2:
When Buhari stops using dozens of SAN to fight his certificate fraud case in court and simply present it, we can let him talk about corruption. Until then he is one big scam and hypocrite.

Shym3xx:


You did selective reading (albeit ya conclusion is also wrong) but didn't read this except from the end of page 4 and beginning of page 5:

This flexibility (floating), however, usually comes at the cost of some loss in credibility and, thus, tends to be associated (on average) with higher inflation. Alternatively, fixed exchange rates reduce the degree of flexibility of the system but impart (in theory) a higher degree of credibility to policy making. Since the public believes that, under fixed rates, the primary goal of monetary policy is 5 to preserve the exchange rate parity, they moderate their wage and price expectations, thus allowing the economy to attain a lower rate of inflation.

^^^The key point there is inflation.

TheGoodJoe:


If you read further, page 5, that theory does not work.

This, of course, is an oversimplification. In fact, as history has shown again and again, fixed exchange rates often fail to impose macroeconomic discipline and end up in major devaluation crises

From my brief study, a floating exchange rate is flexible enough to deal with shocks that would increase the inflation rate.

Image123:


Sure, I stand by whatever i said. All was done in the best interest of the country and to plug and block the leakages of a seriously bleeding country. When there's trouble, you TROUBLEshoot until you arrive at a good place. The new plan is not the destination by the way, it is a when all else fails policy IMHO. It is not a magic wand that sweeps away all our economic woes. Buharinomics is still very much on point compared to what obtained previously. That one where FG borrowed and looted with impunity, where the coordinate minister confessed to high blood pressure and incessant headache. I'll choose Buharinomics a thousand times. The man is not as rigid or bigoted as painted, this picture is clearer by the day.

Although the detailed framework and operational guidelines of the market will be released to the public immediately after this Press Briefing, permit me to highlight its key aspects:

The market shall operate as a single market structure through the inter-bank/autonomous window;

The Exchange Rate would be purely market-driven using the Thomson-Reuters Order Matching System as well as the Conversational Dealing Book;

The CBN would participate in the Market through periodic interventions to either buy or sell FX as the need arises;

To improve the dynamics of the market, we will introduce FX Primary Dealers (FXPD) who would be registered by the CBN to deal directly with the Bank for large trade sizes on a two-way quotes basis; . . .

Onegai:
For those wondering what it means, follow @tunjiandrews on Twitter. He's a smart and objective Economist who analyses Nigerian economy on the radio. And he and other economists are all saying this is a good decision. Even some economists who are totally against Buhari are for this policy. One even said that this was what should have been done since last year.

From all indications, this is a good policy. It will apparently break the hoarding and speculation. And most people didn't see it coming (they assumed CBN couldn't keep fighting).

Basically, if you're hoarding dollars to speculate in the hopes of reaping a windfall, better go and dump them now. Because dollar will be open for competition.

The Central Bank Governor has just announced a full float of the Naira in a press conference in Abuja. The CBN Governor informed a stunned audience that the exchange rate will be market determined and that the CBN will also participate in the market occasionally.

StepTwo:


aunty, abeg no vex. I be Agric/Environmental Engineer.

abeg, dis floating of a thing, is it going to affect orices of goods or its just all about d dollar or rather d exchange rate?

StepTwo:


aunty, abeg no vex. I be Agric/Environmental Engineer.

abeg, dis floating of a thing, is it going to affect orices of goods or its just all about d dollar or rather d exchange rate?

StepTwo:


aunty, abeg no vex. I be Agric/Environmental Engineer.

abeg, dis floating of a thing, is it going to affect orices of goods or its just all about d dollar or rather d exchange rate?

chrisnero:
In the words of Ifeanyi uba, the govenor of CBN and minster for finance is applying academic economics instead of Pratical economics. The governor said" the have a enough reverse to play in the market that is probably €26billion as qouted by shararepoters. With the new policy, there will be rush for dollar which will increase the price because the new price will be determined by the market force as he said.. when the demand is high,the price will increase. We have the issue of militancy in the Niger delta region which constitute more than 70% of our reserve, now tell me, when the €26billion goes down due to rush,how can we replenish our reserve? Try and error is all I see in this policy

tiwiex:


I don't think Buhari has any economic plan. The drop in naira was expected with the capital control. it was a futile effort. It didn't require an experiment to do what CBN just did. The demand and available supply already spelt the situation. So why delay the evil day and suffer while at it? Like I said, Buhari will deliver not because he knows what to do but because reality eventually leaves him with no choice. We didn't need to get to this point on FX and definitely not with the Niger Delta. CBN made the announcement 3 weeks ago but just released the modalities today. They were clearly not ready and just started work on it. Please help Nigerians beg him to slow down on his ego for the sake of the country. Let the advisers take charge. That is why they were appointed. Good move at last but Buharinomics just means trial and error without a need for the trial due to available expert advise.

joseph1013:
After crashing the economy with his stubbornness, Buhari goes back to his vomit and does the same thing he swore not to do, both on local and international media.

May we not be cursed with leaders whose egos are bigger than their love of the common good of the masses.

Max24:

Even if Buhari does not have certificate how does that offence equals that of a looter ? Is it his certificate that will build roads, hospitals, schools and other social infrastructure ? All the other Presidents we av had that have certificate what had been their impact on us ? What was the impact of Jonathan's PhD certificate upon our lives. Upon all of Jonathans PhD the British
Prime Minister said Nigeria is fantastically corrupt.

Onegai:


The exchange rate affects everything in Nigeria, because we import 90% of what we use everyday in the country. Because dollar hiked and fuel increased and some other factors came in, everyone increased their prices of what they were selling. Manufacturers could no longer import their raw materials so they too increased prices. This policy apparently will stop greedy people from artificially causing currency speculation (because banks will tell you they don't have dollar to sell you to transact your business but meanwhile they had sold it to BDC operators to make profit).

But will prices of things come down? Yes, in the long run. Because everyone will know that dollar has season to buy high or buy low. And everyone that needs it can then plan accordingly. So no more rushing helter-skelter for availability.

Guyman02:


The East (Cyrenaica) feel that the West is backing western Libya since the murder of Gaddafi to subjugate them. The first tranche of $700m worth of Dinar printed in UK for Libya Central Bank did not get to them in the amount they expected and therefore decided to print their own currency and they feel that since the oil is in their area they should control it.

What they have done is to align themselves with Russia who can protect them at the UNSC from western attempts to invade them. But as at today America is dropping bombs on the East under the guise of fighting ISIS in Libya but in actually fact they are helping their stooge in Tripoli to expand their territory. its a divide and rule tactics and has nothing to do with Freedom and Democracy.

Now the East has started to ship OIL while Britain has proposed a draft resolution at the UN to enable Nato warships search for weapons in the Mediterranean sea; this is a ploy to prevent ships from the East shipping oil out of Libya. So the Chinese are coming with their ships to lift crude and will not allow Nato to board their vessels.

StepTwo:


@ TheGoodJoe


does this mean with d floating thing, the prices can only come down if the dollar irself falls to d naira?

forgive my economic naivity.
yes, i am an economic dummy.

StepTwo:


@ TheGoodJoe


does this mean with d floating thing, the prices can only come down if the dollar irself falls to d naira?

forgive my economic naivity.
yes, i am an economic dummy.

StepTwo:


@ TheGoodJoe


does this mean with d floating thing, the prices can only come down if the dollar irself falls to d naira?

forgive my economic naivity.
yes, i am an economic dummy.

Onegai:


Long explanation coming up:

You are a landlord who buys land in Lekki phase 1 and builds a block of flats there. You promptly make the price N250,000 because you want to sell instantly and get money. But is that the true value of that house? No. That is what CBN was doing fixing a bank rate of N199.

Your Lekki neighbours are pissed off (they know how much it should be) and punish you by constantly defacing your property, making you spend money to maintain it. And that cycle is getting expensive. That is what CBN was doing using our reserves to strengthen the Naira.

So you hire an agent and tell him you want to rent your building instead and he should show it around and see how much renters are willing to pay. You know that they will pick a value cheaper than the rest of your neighbours but more expensive than your selling price (simply because everyone will be rushing it, making your building more profitable). That is a Floating currency.

Now, you will keep making money as long as you maintain the place. For Nigeria, that means we have to encourage people who have foreign currency to need to buy Naira. In other words, we must be selling something attractive, manufacturing and exporting rather than importing. So that those doing so will be paid in dollars and since they live in Naija, must change those dollars to Naira and there will be enough dollar in the system and those who (genuinely) need to import will get them cheaper and goods will be more affordable since we have a good balance of trade.

Nigeria imports 90% of everything we consume (stvpidly) but exported only crude oil and crude oil prices fell and our economy deflated. But now, those guys exporting Agriculture or Leather Hides or any made in Nigeria goods will be paid according to what the Naira is and will change it and put more Dollar in seculation. So that people importing medical equipment can do so cheaply. And prices of goods will stabilise. Not fall drastically but won't be hyper-inflated.

Let us know how much the Naira is truly worth. But this policy is a long-term policy.

TheGoodJoe:

This floating exchange rate is more of reducing the rate at which the price of goods and services go up in recent times.

This policy is to reduce that. I do not know much about if it leads to reduced cost of good and services. It is more of reducing the rapid growth of prices.

StepTwo:


which means for existing prices to go down other factors needs to come in?

Maxymilliano:
Trial and error governance ...

TheGoodJoe:
Exactly. You are on point.

COMPAQ:
What I need is someone who works in treasury of any bank in Nigeria to tell us at what rate the market is likely to open at on Monday.