PassingShot:
Happy days are ahead of us.

With the news, the worst of our economic woes are behind us.

Kudos to the government for floating the Naira rather than devaluing it. A first in the history of Nigeria.

*Modified*

Some ignorant mourning wailers are saying floating the naira is same as devaluing it. Hell NO!

If you devalue the Naira, you fix an official exchange rate to it. E.g N250 to a dollar. With that approach, the black market rate will jump to beyond N400 to a dollar.

But with floating, many traders with high volume of dollars come in and trade dollars based on demand. In this approach, there is no official dollar rate set by the government. The rate is purely determined by how much dollars are demanded and how much dollars are available. This way, the Naira finds its true value.

crazymommy:
As expected....about 3 days ago a guy on a thread said he wants to sell his 10000$ Which he said he bought at the rate of 302 but that he wants to wait till it gets to 400naira per dollar,I adviced him that he should better sell it at that moment when it was around 350 because anything can happen on Monday which is today because I believe that the market might possibly fall in between the official price and the last parallel market price and that should be around 250-290.guess what??the guy said I am deceiving myself...that he is very intelligent and he believes that the dollar price will even open higher on Monday which is today....I hope the overconfident ignorant fellow his reading this...the annoying thing about some people on nairaland is that they feel they know it ALL and they are not ready to hear the opinion of any other person especially if it is coming from a woman....smh...

PassingShot:

I can properly school you in economic indices.
When naira was pegged officially at 197, did you see it to buy?

Again, read about differences between devaluation and floating perhaps you will be able to cure your ignorance.

seniwellsFX:
it's quite unfortunate that many person's do not really have basic economic knowledge and how the forex market works. now there are many economic factors that determine the exchange rate of any nation's currency. these are interest rate,inflation rate,both employment and unemployment rate,trade balance(import and export), production data(manufactured and non manufactured goods), business confidence(purchasing managers index(PMI) which shows how confident business managers are in doing business in that country as well as a measure of their profitability within a specific period), both monetary and fiscal policies,GDP, just to name a few. now for a nations currency to strengthen against its foreign counterpart,all or most of the above listed economic indicies needs to be on the positive side of the treshold or at least within the central bank's forcasted levels. but as of today all economic indicies are beyond emefiele's forcasted levels. nigeria's interest rate is in double digit, unemployment rate that one no need to talk am,inflation rate is at 15%,we have negative trade balance,meaning we are importing more than exporting,fiscal policy of the nigerian gov't never get direction and others. we should'nt be counting our eggs now because of short term price fluctuations. though the new fx policy is good,but if not followed with continues real monetary and fiscal policies it will be useless and both the naira as well as our economy will suffer more in the future. we can only know the effect of these policies after the 3rd and 4th quarter of the financial year of 2016. i still forsee the naira dropping against its major foreign counterparts in the short to medium term(2 to 4 months.between #255-380 interbank rate) due to the economic realities on ground(low oil prices et al).mind you,global economic slowdown is also playing its match internationally. but in the long term if major economic indicies begin to improve the naira will rally(strengthen) and fall below #200/$1. so lets forget about intraday fx price fluctuations and focus more on the longer term price projection of our beloved naira against other fx majors.

PassingShot:
Happy days are ahead of us.

With the news, the worst of our economic woes are behind us.

Kudos to the government for floating the Naira rather than devaluing it. A first in the history of Nigeria.

*Modified*

Some ignorant mourning wailers are saying floating the naira is same as devaluing it. Hell NO!

If you devalue the Naira, you fix an official exchange rate to it. E.g N250 to a dollar. With that approach, the black market rate will jump to beyond N400 to a dollar.

But with floating, many traders with high volume of dollars come in and trade dollars based on demand. In this approach, there is no official dollar rate set by the government. The rate is purely determined by how much dollars are demanded and how much dollars are available. This way, the Naira finds its true value.

greatiyk4u:



Who re the "us"?

AtlanticBreeze:

keep deceiving yourself.. This is not the first time Naira is being floated.. It was floated during babangida's regime and that was what crashed the strength of the naira to dollar then.. Let's see if naira doenst hit 500 to 1 dollar in few weeks time

OJaySeenson:
You are wrong sir. All these items have already been quoted in dollars for a long time. I can't remember the last time I bought a plane ticket whose price was quoted in naira. Since they were already holding dollar positions before today, the prices are not significantly going to change. At least not the dollar rates, at least. I could be wrong though. Just an opinion.

Ogetogeo:



Not parallel market rate but interbank rates. That is how much banks can buy from bigger banks that CBN has assigned.

Its like this, CBN pegged the dollar at 197 and were the only bank that could sell at that rate but now they have changed the peg to about 250 but have other partners banks that can sell to smaller banks at that rates.

Ok. I understand. Thanks!

So, no bank can sell to you at that rate technically.

Forget all the economic jargons.