These are definitely not interesting times for the nation’s economy, particularly the national currency, the naira, no thanks to the depleting reserves and the subsequent banning of importers of 41 items from the foreign exchange market by the Central Bank of Nigeria.

Barely 10 days after the CBN stopped forex sale to importers of rice, textile and 39 other items, the naira on Wednesday crashed to 230 against the United States dollar at the parallel market, down from 218 recorded on June 23 when the new forex rule was introduced.

The policy, which has pushed huge forex demand from the interbank (official) market to the parallel (black) market and the Bureau de Change retail segment, has led to artificial scarcity of dollar and other major foreign currencies as operators now hoard them in anticipation of higher prices.

The naira had fallen to 220, 223, 226.5 and 228 against the dollar in the past one week.
Black market and BDC operators, however, told our correspondent that serious dollar liquidity squeeze was already hitting the market and operators were no longer in possession of huge stock of forex to meet rising demands, especially from the importers of the banned items.

Using the CBN figures, analysts had estimated that about $5.7bn quarterly forex demand was being transferred from the official interbank market to the black market.

“The situation is getting critical now. There is serious dollar liquidity squeeze in the market now. The demand is overwhelming and both the black market and the BDC segment can no longer meet the demand,” a black market operator told our correspondent on Wednesday.
“The market is very volatile now as a result of the restrictions placed on about 41 items by the central bank. Most importers are now patronising the parallel market to source their dollars,” the head of a BDC, Mr. Harrison Owoh, told Reuters on Wednesday,.Meanwhile, the Association of Bureau De Change Operators has written to the CBN asking it to intervene in the dollar scarcity in the parallel market and the BDC segment to save the naira from crashing further.

In the letter, a copy of which was obtained by our correspondent, the association expressed its readiness to work with the CBN to stabilise the market.

The letter, signed by association’s President, Alhaji Aminu Gwadabe, and Executive Secretary, Uduma Cletus, advised the CBN to increase its weekly forex sale to the BDCs from $30,000 to $50,000.

The body also asked the central bank to reintroduce the autonomous market where it could sell about $100,000 to the operators.
Gwadabe told our correspondent that it was expedient for the CBN to increase its forex sale to the BDCs in order to stabilise the naira.
Some analysts believe the naira may hit 240 against the dollar in the coming days.

However, the naira traded at 198.95 to the dollar at the interbank market on Wednesday, according to Reuters.
The central bank had lowered its exchange rate peg to N196.95 to the dollar on Tuesday from N196.90 last week

Also, a trade of $735.74m went through on Nigeria’s interbank currency market at N198.45 on Wednesday, Thomson Reuters data showed.

Market sources said a foreign client had sold dollars to a bank in Nigeria. Total interbank market volumes stood at $1.12bn on Wednesday, far higher than typical trading sessions since the central bank introduced a naira peg in February.

Meanwhile, the CBN has reminded dealers and banks that their dollar cash sale for six items, including schools fees, insurance premium, basic travel allowance and monthly mortgage should not exceed $5,000.

In a new circular dated July 1, 2015, the CBN also warned banks not to sell forex to the importers of the 41 items that were banned from the forex market last week.

http://www.punchng.com/news/naira-falls-to-230-dollar-supply-dries-up/

Ok. All I know is that very soon things will be alright and Nigeria Economy shall rise again. We are the giant of Africa because we lead and other African countries follow... In PMB we trust.

Not good for the economy

Instead of coming down e dey go up. Baba what happen to #1»»»$1? Smh #BabaOnechance ooooo

Nigerian Economy as its doesn't stressed the need of $1/N 1, we need to grow the Economy and even devalue the naira more and encourage local manufacturers on quality production, efficiency etc. Then we would start competing with the developed world.

It's like an old fashioned steam train in the night.....out of control, thundering through the eerie darkness and going deeper into the misty fog before it! The train whistle blasts intermittently by unseen ghostly hands, echoing into the night as all the passengers -with their hearts in their mouths- grip the sides of their seats in sheer panic! The news gradually spreads from one carriage to the next......the driver and his coal-shoveling assistant have panicked and gone AWOL, leaving the passengers on their own to deal with the impending doom that lies before them!

Suddenly, coming into view in the distance as the train clears the misty fog that enveloped it......the precipice; a sad end to a journey that started off so well!

Good for people like moi.

Change is happening and Buhari has forewarned us to brace up for the challenges of next few months in order to have years of enjoyment.

Bad structure need to be demolished to institute a better one ... you don't build good structure over bad foundation.

Bollove:
Change is happening and Buhari has forewarned us to brace up for the challenges of next few months in order to have years of enjoyment.

Bad structure need to be demolished to institute a better one ... you don't build good structure over bad foundation.

And you bought that crap?!

Losses piling up.

It make sense to devalue the naira more. Naira can be like 220 naira to a dollar.

do we even have president in this country. see west germany is making progress in propaganda and more lies to discredit their former president GEJ while in our country the president is busy releasing photo per hour as if he is contesting with kardistian family. 1-diot

These days we have more touts on nairaland than the intelligent ones, this guy above me belongs to the former

May God help naira. Cos the way naira is sky rocketing ehnn!!

sameer1212:
Ok. All I know is that very soon things will be alright and Nigeria Economy shall rise again. We are the giant of Africa because we lead and other African countries follow... In PMB we trust.

Abeg Giant in terms of what? aside population wetin we na get again?

Buhari has destroyed our economy. I knew what I was saying when I was demanding for the Dullard's Certificate. He knows ziltch about economics. He's a confirmed dullard from Daura

[size=25pt]#ShowYourCertificate
#BabaOneChance
#DauraDullard[/size]

Baba please start fulfilling all ur promises.

#1 = $1


#BabaOneChance

And western union changing money at 190.78 I dont get it

Brace up

Nigeria is on a free fall
No policy direction, no ministers
Investors are apprehensive
Importers are mopping up the scarce forex in anticipation of higher price
Boko Haram is gathering momentum, throwing bombs even the mere commissioner was around
NASS fighting over appointments
APC divided

Meanwhile Buhari and his VP daughters are sharing pictures everyday

#keepingupwiththebuharis

These are crunchy times for the country. Buhari should tread softly lest we all dry up because he is making a change. Change should be about value-addition and not evaluative. When he takes his time evaluating GEJ performance, his tenure will just waste away. He has sacked nnpc board of directors, which could have scared foreign investors and I heard that he wants to remove fuel subsidy. These are good but he should be cautious since they will affect the Naira badly (Foreign exchange has a positive relationship with unemployment). If he is to go on with fuel subsidy removal, he could remove from the consumption side and maintain subsidy on the side of production. Our local producers of oil need this subsidy to match the activities of the importers. This will go on to help Nigeria and our Naira.

God help us

This aint good at all

Meanwhile, read part three of the Diary of the village boy, EVENING OF SHOCKS, get your Shock-resistant Vest on before reading, lol

https://samueliyanu./2015/07/02/diary-of-a-regular-village-boy-3-the-evening-of-shocks/

Who do we run to?

CHANGE!

Sai baba miracle !!!!!! We call on you answer us now 1dollar = 1naira.

H

DONMAYOR19:
do we even have president in this country. see west germany is making progress in propaganda and more lies to discredit their former president GEJ while in our country the president is busy releasing photo per hour as if he is contesting with kardistian family. 1-diot

Your mates don dey get sense you still dey here

The economy is in a state of uncertainty. We don't know what will happen next.
Do we still have a government in place in this country. The president has lost it! Confused f00l from daura!

It's well...
Be part of us here........
www.nairaland.com/1798724/

Thank me later.