[size=13pt]Naira depreciates to lowest level in two years[/size]

The naira on Wednesday fell to its lowest level in over two years against the United States’ dollar.


This, according to foreign exchange dealers, is as a result of the continued inability of the Central Bank of Nigeria to meet the demand for the dollar; a development which they said had stretched for straight 21 days.


At the inter-bank market, the naira closed at N157.92 to the dollar, down from Tuesday’s figure of N157.20. Traders told Reuters that the current position of the naira was its weakest since August 14, 2009, when it hit N158 per dollar.


Out of $560.54m requested for by dealers at the official window on Wednesday, the apex bank only sold $350m at N154.42 to the dollar. The CBN had the preceding day sold $350m at N153.91 as against $467.6m demanded by dealers.


“The initiatives taken by the CBN both in raising MPR and other measures of tightening our fiscal policy may mean well but are telling on the forex market,” the Managing Director and Chief Executive Officer, Atlass Portfolios Limited, Mr. Ubale Yahaya, told our correspondent.


“The naira for some time now has persistently fallen against the dollar and this is not good for our currency.”


The CBN, among its other reforms, had on Monday raised the Monetary Policy Rate by 50 basis points from 8.75 to 9.25 per cent.


Meanwhile, traders stressed that the pressure on the naira was largely due to the actions of the regulatory bank, as they argued that the apex financial institution had over time refused to meet the demands of dealers.


“The central bank has consistently allowed the depreciation of the naira at its auction in past months and with a large inventory of unmet demand, putting further pressure on the available dollar stocks at the inter-bank market,” a dealer told Reuters.


According to traders, the inter-bank market usually takes a cue from the trends at the bi-weekly foreign exchange auction.


They however, noted that local unit of US energy firm, Exxon Mobil, sold about $50m to selected banks, but it was not enough to provide support for the naira.


The traders expressed worries that the local currency might continue its downward plunge if the apex bank failed to intervene.


“The naira is going to continue to experience steady depreciation until the end of the year as long as there is strong demand and the CBN fails to meet market expectations,” another trader, who pleaded anonymity said.

http://www.punchng.com/Articl.aspx?theartic=Art20110922322340

But what does that all matter? I mean on his facebook page, the president is busy patting himself on the back that he is able to _{cook up} record high growth for the economy and reduced inflation.

Recall that I informed you that inflation dropped from 10.2% in June to 9.4% in July. I am pleased to say that the inflation rate again dropped to 9.3% in August as confirmed by the CBN and independent international organizations. This is as our economy grew by 7.72% in the second quarter. As we tighten fiscal and monetary policies and direct resources to education (which has the highest allocation in the budget), power and roads, we will also see similar growth in our developmental indices. GEJ
http://www.facebook.com/jonathangoodluck/posts/239381299445585

So the bank stock I bought 4 years ago, on top of being worth less money due to Sanusi, is also worth less due to exchange rate.

Bleh

Thank you Sanusi

The depreciation of the Naira will continue as far as the Nigerian government refuses to diversify the economy , encourage local manufacturing and expand the base of foreign exchange earnings other than oil revenue.

Yet in the eyes of THE Retardeen, the economy is booming and inflation is dropping.
Idiots !!!!!

Much as I ascribe this ugly trend to overdependence on importation, roundtripping also largely contibutes to it.

CBN really needs to authenticate some of the forex requests. The requests are outrageously suspect.

fyneguy:

Much as I ascribe this ugly trend to overdependence on importation, roundtripping also largely contibutes to it.

CBN really needs to authenticate some of the forex requests. The requests are outrageously suspect.

A request means real cash (normally in the form of submitted bank drafts which are confirmed) has been submitted.

So what other means of authentication do you mean or suggest?

GEj please sack sanu-nsi . He is spoiling your economic plans!

You all can say what you want, this is very good news for Nigerians who have active benefactors in the US.

We should go back to the Gold standard my Friends.

@ HenryPeinSama

You all can say what you want, this is very good news for Nigerians who have active benefactors in the US.

Who told you that a $ in the US is easy to come by? Especially in their tough economic climate and rising taxes.

ok

God have mercy on our economy. GEJ please do something

we're done in. Malams will have a field day.

This shows the economy has improved significantly under a 'good luck' administration (Irony).

My Friends, our economy is fundamentally flawed. This increases inflation, as importers will increase the prices of their commodities. The average man's wage remain flat and he feels the heat in his pocket. We get 95% of foreign exchange from oil. If there is a significant drop in oil prices in the international market effected by new technologies or some unknown factors, expect DOOM and GOOM for Naija.

We need to diversify fast. I doubt GED understands the principles of Economics. Although he is a good man with good intentions, he is being manipulated by men who understands how the system works.

Only Islamic Bank will save Nigeria economy

who is to be blamed GEJ or SANUSI?

£1 was N268 the other day on legal bank transactions o
I wonder how much it is in Ama hausa?
I hope it reaches N350.

w

For a country as populous as Nigeria, I see nothing wrong with the devaluation of our currency. In fact, under normal circumstances, I'd welcome it.  A country with a large workforce as Nigeria should be a major exporter of goods by now, and a devalued currency is the only edge we'd have over other countries exporting goods.

  IN THEORY:
Cost of labor is a MAJOR COST OF PRODUCTION, and it is largely tied to cost of living in the area of production, which in turn is largely tied to the value of the local currency of production.

For instance, feeding for a factory worker in Detroit would be about 20 Dollars a day. We're not talking about other expenditures. N3,500 a day in Nigeria? For what? Feeding a factory worker? The value of the Naira has lowered cost of living to an extent that cost of labor is now very low.

In a less populous country, this theory would probably not play out properly because production in a country with a small population would be capital intensive, and not labor intensive. In a country with such a large workforce as Nigeria, the bulk of the cost of production would probably go to labor, and if labor is cheap, then cost of production would also be relatively cheap.

Look at Japan. What made Japan such a power? LOWER COST OF PRODUCTION.  Factory workers in Japan get paid in Yen, which is far lesser in value to Dollars. Cost of living in Japan is also calculated in Yen. Even where machines replace labor, the machines are produced by humans who are also subject to the theory.

@Henry40

For a country as populous as Nigeria, I see nothing wrong with the devaluation of our currency. In fact, under normal circumstances, I'd welcome it. A country with a large workforce as Nigeria should be a major exporter of goods by now, and a devalued currency is the only edge we'd have over other countries exporting goods.

IN THEORY:
Cost of labor is a MAJOR COST OF PRODUCTION, and it is largely tied to cost of living in the area of production, which in turn is largely tied to the value of the local currency of production.

For instance, feeding for a factory worker in Detroit would be about 20 Dollars a day. We're not talking about other expenditures. N3,500 a day in Nigeria? For what? Feeding a factory worker? The value of the Naira has lowered cost of living to an extent that cost of labor is now very low.

In a less populous country, this theory would probably not play out properly because production in a country with a small population would be capital intensive, and not labor intensive. In a country with such a large workforce as Nigeria, the bulk of the cost of production would probably go to labor, and if labor is cheap, then cost of production would also be relatively cheap.

Look at Japan. What made Japan such a power? LOWER COST OF PRODUCTION. Factory workers in Japan get paid in Yen, which is far lesser in value to Dollars. Cost of living in Japan is also calculated in Yen. Even where machines replace labor, the machines are produced by humans who are also subject to the theory.

You are ignoring the root of the problem, Infrastructure! Without that, your theory is useless. You have to be realistic and stop living under false illusion of Theory.

Regarding labour cost of a large workforce, it may help to boost an economy but is it sustainable? As economy grows, workers demand for increase in wages.

auwal87:

A request means real cash (normally in the form of submitted bank drafts which are confirmed) has been submitted.

So what other means of authentication do you mean or suggest?

I dont know what you mean by real cash. I am talking about Form A and Form M requests by bank customers to buy dollar at official rate. If you know what roundtripping means, you will understand my query better. Banks in connivance with customers make frivolous requests for dollar whereas the money is channelled back to the black market for profit.

Pls what is the current black market rate for the dollar

Barely a few months ago, Nairalanders came out en mass demanding an apology from the International Monetary fund for daring to make a disappointing forecast on possible future trends of the Naira. . . . it was indeed a very Nairalandish moment; blaming everything western including the official cat on 10 Downing  street whilst ignoring their country's fundamental problems.  The IMF boss must be having a good laugh . . .down goes the naira, slowly but surely!

https://www.nairaland.com/nigeria/topic-248678.0.html

i dont kno which one to take here, see dis other topic, plss can a blind man xplain beta to me

i saw 200 in another tread now i am seeing 157

please what is the value of other currencies against the naira. I have a huge pyament to make in Euro. Should I go and buy now for fear of further rise in price of Euro against the naira.

Anybody knows the current price of the Euro please?

sansui why

Were is Soludo? This Sanusi man is nothing but,

Shebi Odechukwu Retardeen said the economy was improving

[size=28pt]FRESH AIRRRR[/size]

^^^^