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Nairaland Forum / Nairaland / General / Naira Tumbles To 371 As Dollar Scarcity Persists (459 Views)
Naira Tumbles To 402 On Dollar Scarcity / Dollar Scarcity Presists, Naira Tumbles To 371 / "Time To Panic"? Nigeria Begs World Bank For Massive Loan As Dollar Reserves Dry (2) (3) (4)
Naira Tumbles To 371 As Dollar Scarcity Persists by Adedeji2012(m): 5:31am On Jun 09, 2016 |
The continuing pressure on the naira
rose sharply on Wednesday with the
local currency tumbling to a new low of
371 against the United States dollar at the
parallel market. It had closed at 361 per
dollar on Tuesday.
The delay by the Central Bank of Nigeria
in explaining how the proposed flexible
exchange policy will work has increased
Foreign exchange dealers and investors
said the delay had caused uncertainty in
the foreign exchange market and fuelled
hoarding of hard currencies.
According to foreign exchange dealers at
black markets in Lagos, Abuja and major
airports across the country, the dollar
was sold for between 367 and 373 on
Wednesday.
Findings from various operators revealed
that the local currency went for 371
against the greenback in most of the
parallel market locations.
Abokifx.com, an online portal that
monitors the movement of exchange
rates at the parallel market, reported that
the naira closed at 367 against the dollar.
However, the currency traded at 199.40
to the dollar on the official interbank
market, within the CBN’s pegged rate
band.
“Demand for the greenback has
increased amidst growing scarcity as
uncertainties created by the new policy
have caused individuals to start to stock
dollars,” the National President,
Association of Bureau De Change
Operators, Alhaji Aminu Gwadabe, told
Reuters on Wednesday.
Economic analysts said heightened
political risks, evolving economic crisis
and the CBN’s delay in unveiling its
blueprint on the proposed forex policy
were responsible for the fast depreciating
rate of the naira at the parallel market.
An economic analyst and Chief Executive
Officer of Cowry Asset Management
Limited, Mr. Johnson Chukwu, said,
“Foreign investors are fast losing
confidence in the economy, seeing that
they cannot bank on what the central
bank says. It is almost two weeks now
since the announcement of a new policy
and yet, the blueprint has not been
unveiled.
“Secondly, the Minister of State for
Petroleum Resources, Dr. Ibe Kachikwu,
just said that oil production had fallen
significantly as a result of the disruption
in the Niger Delta; this means a major
drop in our forex earnings. So, this is an
evolving economic crisis.”
Other analysts said the value of the local
currency was dipping because
customers were trying to hedge against
a possible depreciation when the CBN
clarifies its new forex policy.
The naira had closed at 357 against the
greenback on Monday, before crashing
to 361 on Tuesday.
The CBN had recently said it would
abandon its naira peg to the dollar and
introduce a flexible currency exchange
regime.
It has not said how this will work, a
situation that has unsettled investors who
are worried about getting caught in the
middle of a devaluation.
The CBN’s Monetary Policy Committee
had two weeks ago announced the plan
to adopt a flexible exchange rate. The
Governor, CBN, Mr. Godwin Emefiele,
said the blueprint for the proposed policy
would be released soon.
The delay has, however, caused the
stock market to record huge losses after
recording landmark gains following the
announcement of the plan to adopt the
policy.
The central bank banned dollar sales to
retail Bureaux De Change in January and
reduced supply at its official interbank
forex market in an effort to conserve
reserves, now at their lowest level.
Source: http://punchng.com/naira-tumbles-371-dollar-scarcity-persists |
Re: Naira Tumbles To 371 As Dollar Scarcity Persists by emotions1: 5:35am On Jun 09, 2016 |
Omo naija nah prayers sure pass ooo.... |
Re: Naira Tumbles To 371 As Dollar Scarcity Persists by cckris: 5:42am On Jun 09, 2016 |
Buhari's plan is obvious, to punish Nigerians to submission, as he's doing to the Opposition party, until no one will be able to protest against his tyranny, then will Buhari unleash his brutal Totalitarian Dictatorship on Nigerians. |
Re: Naira Tumbles To 371 As Dollar Scarcity Persists by chigoizie7(m): 9:01am On Jun 09, 2016 |
Lolz. We haven't seen anything yet. Shell has shut down operations indefinitely. International refineries has stopped purchase of crude from naija because of NDA wahala. We are currently running an import deficit of over $180billion. Our external reserve has been predicted to not take us as far as 6months time( No fx for imports). Since no sale of crude, then no fx earnings, den more scarcity of fx, apply the principles of demand and supply, the higher the demand(scarce fx), the higher the price. My brothers, sit tight and watch out, dollar will be traded soon (less than a month) @ $1 to N600. Welcome to naija, where anything that goes up, doesn't come down. 1 Like |
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