TheGoodJoe:


It will take time to buy Dollars cheap. It is expected for the price to go up. CBN is keeping it low for now due to scarce dollars. With time Dollars will spread to the banks and then, as expected, the Price will settle below N300 at all points.

For now, you can not buy dollars at that price.

JUBILEE2000:


Dollar will not settle for anything below N300 for a long time to come.
A time will come when CBN can longer sustain this periodic intervention then speculators will determine the real value of the naira. This might take us back to square one if care is taken. Dont also forget that the dollar can never get to the man on the street at the interbank rate

InvertedHammer:

/
You are wrong.
Effective intervention involves tens of billions of dollars and are usually shortlived. Nigeria's total external reserves is not enough to prop up naira. Russia threw in $90 billion dollars to support the rubble and the market swallowed it. Rubble went ahead and melted against the dollar. Nigeria does not have that kind of money to fight for naira. The best bet is to let naira float freely with other currencies against US dollars and hope for the best. That is exactly what Emefiele and co. are implementing at this time. Any further explanation beyond this is just propaganda.
\

TheGoodJoe:


Thanks for the correction. The Scarcity I am referring to is Dollars released by the CBN from our reserves into the Interbank Market. As sales went on, Dollars available for sale reduced. This in turn increased the price of Dollars, pushing towards N290.

CBN intervened by bring more dollars from the reserves, making dollars available and pushing the price of dollars down, towards N285.

I will correct my post. Thanks.

trillville:


The start of the fall in oil prices coincide perfectly with an announcement that interest rates will be lifted by the US federal reserve. This occurred around June/July 2014. All other commodities such as gold and silver also fell in value.

Oil prices further declined sharply in November 2014 when OPEC announced it wasn't going to reduce production outputs.

Last December US federal reserve lifted it's interest rates for the 1st time in close to 10 years. At this same period oil hit its lowest levels of about 27 dollars.

Finally, last month US job report numbers were so bad that it is near impossible that the Federal reserve would further increase rates this year and is even more likely to reduce rates. This is a huge positive for higher prices of oil.

The value of the naira all things being equal should typically rise and fall as crude oil prices rise and fall respectively.

PS
I do not hold brief for this government neither am I an Emefiele follower. I only find it interesting that the CBN chose the very moment the US economy showed a major sign of weakness to reverse its bad policy of fixing the naira rate.

TheGoodJoe:


A lot of analysts, before the kick off of the Policy expected the price to settle below that. That is what I am working with. They pointed that there will come a time CBN will stop intervening and let the demand and supply of the market take over the direction.

The analysts also expect the naira value to fall before it settles below N300.

That is the expected target and that is what I think will happen. Also, the price the consumers will finally buy dollars when it settles will not be much different from the Interbank rates. That is what this Policy is out to achieve. A narrow gap between the Interbank and Black Market price.

TheGoodJoe:


A lot of analysts, before the kick off of the Policy expected the price to settle below that. That is what I am working with. They pointed that there will come a time CBN will stop intervening and let the demand and supply of the market take over the direction.

The analysts also expect the naira value to fall before it settles below N300.

That is the expected target and that is what I think will happen. Also, the price the consumers will finally buy dollars when it settles will not be much different from the Interbank rates. That is what this Policy is out to achieve. A narrow gap between the Interbank and Black Market price.

JUBILEE2000:
[b][/b]

How narrow will this gap between the interback rate and the consumer's rate be? who regulates this gap? I have a problem with leaving the value of naira to be determined by demand and supply. The cabals will hijack this policy as usual.

JUBILEE2000:
[b][/b]

How narrow will this gap between the interback rate and the consumer's rate be? who regulates this gap? I have a problem with leaving the value of naira to be determined by demand and supply. The cabals will hijack this policy as usual.