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EFCC Raids Speculators As Naira Drops To $1,520/$ - Business - Nairaland

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Naira Drops At Parallel Market, Closes 900/$ At Official Window / BDC Operators Caution Currency Speculators As Naira Strengthens Further / FG Moves To Digitise FX Transactions To Punish Naira Speculators (2) (3) (4)

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EFCC Raids Speculators As Naira Drops To $1,520/$ by Racoon(m): 11:34am On May 15
Operatives of the Economic Financial Crimes Commission, on Tuesday, expanded its clampdown on Bureau De Change operators, arresting traders in Abuja, Lagos, Kano and Port Harcourt. This came as the naira weakened further against the United States dollar at both the official and parallel foreign exchange markets. The recent raids followed renewed efforts by the Federal Government to tackle the naira’s recent fall against the greenback.

The activities of currency speculators in the forex markets and the digital cryptocurrency space have reportedly increased pressure on the naira, with the government accusing crypto traders of speculating against the national currency. Last week, some BDC operators were arrested in Abuja for allegedly speculating against the naira.

Despite resistance by some BDC operators, law enforcement officials have continued to conduct regular raids on unauthorised currency traders in the Federal Capital Territory. Currency operators, who spoke to one of our correspondents, confirmed that the latest sting operations occurred at various times during the day in Lagos, Kano Port Harcourt and Abuja on Monday.

Malam Yahu, a trader at the popular Wuse Zone 4 market, said currency traders at Lagos, Port Harcourt and Kano confirmed sting operation by EFCC operatives, a development that disrupted market activities. He said the fear also trickled down to the Abuja market as traders decided to reduce trading for fear of being arrested.
Yahu also said the naira was bought and sold for N1,520/$ and 1,540/$.

He said, “The naira is now N1,540 and we are buying at N1,520. But the issue now is that the EFCC guys scattered the market in Lagos, Port Harcourt and Kano today. As a result of the development, the traders in Abuja were very cautious about trading.

“So in Abuja today, people are afraid because we don’t know when they will come too and nobody wants to be arrested. It is also part of the reason for the high rate.

“Traders are also afraid of buying at a high price because they are cautious that the dollar may crash at any time. Our brothers in Lagos and Port Harcourt are complaining about the arrests. Another trader, Abubakar Taura, confirmed the same rates and the arrests by security agents. “Yes, we heard today that EFCC operatives have started arresting people in other states,” he said.

The President, the Association of Bureau De Change Operators, Aminu Gwadabe, confirmed the raid, saying however that the EFCC operatives primarily focused on street traders.He confirmed that some registered BDC operators were affected in the raid.

“Yes, the EFCC operatives raided street traders although some of our members were also affected. The government is trying to deal with illegal practices. We believe the currency will appreciate with time,” he said. At the parallel market, the naira closed at N1,540 per dollar.

This represents 4.05 per cent or N60/$1 depreciation compared to the N1,480 quoted on Monday on the black market. The renewed naira depreciation after the gains in April 2024 was attributed to a shortage of dollars occasioned by the repatriation of funds by foreign portfolio investors.

Similarly, official FX trading at the Nigerian Autonomous Foreign Exchange Market witnessed a depreciation in the value of the local currency by 3.04 per cent as the dollar was quoted at N1,520 on Tuesday, weaker than N1,478 quoted on Monday. This is the lowest in over six weeks and the first time the official rate will close above N1500/$1 since March 19, 2024.

The intra-day high also plummeted to N1,568/$1 from N1,515 recorded on Monday pointing to an even weaker exchange rate at some point during the day, according to data from FMDQ, where currencies are traded officially.
The intra-day low was N1,350 on Tuesday from N1,301 recorded on Monday.

The intra-day high represents the highest price at which the dollar traded against the naira on the official market during a single day of trading. The exchange rate typically fluctuates throughout the day The amount of dollars supplied by willing buyers and willing sellers also decreased by 40.8 per cent or $88m to $128.76m from $217.64m on Monday.

The naira had extended its appreciation from mid-March till mid-April, before the recent decline. The naira however closed flat against the dollar in April, appreciating only by about 0.04 per cent in the official market. The temporary stability occurred after the CBN interventions aimed at curbing speculation on the naira.

Some of the measures taken by the CBN included the prohibition of Foreign Currency Collaterals for Naira Loans and the directives to the International Money Transfer Operators to align their exchange rates with prevailing market rates at the official foreign exchange market.

In February 2023, the Yemi Cardoso-led CBN implemented the first interest rate hike, raising the MPR by 400 basis points to 22.75 per cent. This was followed by an additional increase in March, raising the MPR by 200 basis points to 24.75 per cent. The hikes in interest rates coincided with a strengthening of the naira, which appreciated to as high as N1,150/$1. Commenting on the latest development, an economist at the Nigerian Economist Summit Group, Faith Iyoha, said the naira was still experiencing volatility due to the absence of fundamental FX liquidity policies.

Faith, who spoke in a telephone interview on Tuesday, said the sufficient condition for strengthening the naira must be an increase in FX liquidity which according to her is only possible through exports and foreign capital inflow, both of which the country currently lacks. She added that although the apex bank had made some changes, there was still a need for an improved macroeconomic space.

Related News CBN may intervene as naira slides to 1,478/$ Naira now worst performing currency in the world - Report BDC operators arrested as naira sells 1,416/$

She said, “The exchange rate has been largely volatile over time and there are fundamental reasons why it has been like that. It is important to give credence to the reforms that CBN has put in place and other regulatory approaches but while these are necessary approaches, they are not sufficient to strengthen the naira.

“The sufficient condition for strengthening the naira must be an increase in FX liquidity which is only through exports and foreign capital inflow. From the export angle, while we have crude oil, the production has been largely below 2m barrels and that means an instability in inflow.”

She added, “We still have to improve non-oil exports as well. In terms of capital importation, we have seen the exit of portfolio investors due to large instability and there is no clarity in the market. There is instability in the sense that we are not certain about the policies that are going to come up in the next few months especially when we talk about taxes and levies.

“So you see that the cybersecurity levy has been suspended, such policies give investors a sense of instability and uncertainty and in that way, they exit the market. So it is important to state that for the naira to gain stability, we must improve FX inflow, especially through trade.

“We must create macroeconomic stability that incentivises the inflow of foreign capital and if it doesn’t happen, there is no way we can sustain the strength that the naira gained based on reforms by the CBN.”

MAN, LCCI react
Meanwhile, members of the Organised Private Sector have reacted to the development. The President of the Manufacturers Association of Nigeria, Francis Meshioye, said the continuous fluctuation of the exchange rate had made it difficult for manufacturers to construct and stick to a fairly predictable business model.


He further stated that manufacturers would inevitably be forced to review prices to reflect the prevailing exchange rate to remain in business.

Meshioye said, “All the plans we have made recently have to be reviewed, which is not good, not only for the economy but the unpredictability of our business model. Our business model is a floating one. It is not good for the economy because the international business community relies on the business model that you presented, and we have to continue to review our business model.

“Take for instance, some of our members have had to change prices because of the fluctuations. Manufacturers will continue to do business based on the current costs and the replacement costs of their products. You don’t want to sell a product and be out of stock because you are unable to replace it.”

On his part, the President of the Lagos Chamber of Commerce and Industry, Gabriel Idahosa blamed the shortfall in dollar supply for the recent depreciation of the naira. Idahosa predicted that fluctuations in the exchange rate would continue as it is a natural consequence of floating the local currency.

He, however, cautioned that if the depreciation was allowed to persist, price hikes would once again become commonplace in the marketplace.

He said, “The market is struggling to stabilise that is why we are seeing this level of volatility. The CBN is managing a very difficult situation because we don’t have established trade flows from our non-oil exports.

Asked if manufacturers have implemented price hikes if the depreciation continues, Idahosa said, “Yes, of course. It will happen. We are hoping that the exchange rate does not get to that precipice of N1,800 or N1,900.”

Meanwhile, the National President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, Dele Kelvin Oye, also expressed concerns over the significant depreciation of the naira, noting that it poses multiple challenges for the country.

Oye, in a statement, expressed worry over the impact of the currency depreciation on import costs and inflation, reiterating the need for the government to stabilise the naira by potentially pegging and defending it.

He said, “The significant depreciation of the naira, now at 1500 to the dollar, poses multiple challenges for Nigeria. The weakening currency increases import costs, affecting prices of everything from food to electronics, thereby fueling inflation and reducing the purchasing power of Nigerians, especially those on fixed incomes. Higher import costs also escalate production expenses in sectors reliant on foreign materials, impacting overall business operations.

“Government and business foreign debt servicing costs rise as more naira is needed per dollar, straining financial resources and potentially reducing public service funding. While a weaker Naira might attract foreign investment by making assets cheaper, it could also deter investors seeking stability.”

He further stated, “On a positive note, a devalued naira enhances the competitiveness of non-oil exports like agriculture and manufacturing on the global market. However, this benefit is contingent on the country’s ability to efficiently increase production.

 The NACCIMA president advised that “Given these complexities, the government must stabilise the Naira by potentially pegging and defending it, rather than leaving it to market forces, a strategy even economically stronger nations like Qatar and Saudi Arabia employ.”

Foreign Portfolio Outflows
Meanwhile, foreign outflows of investment on the Nigerian Exchange Limited hit N119.81bn in the first quarter of 2023.
This was revealed in the latest domestic and foreign portfolio investment report released by the NGX recently.


During the quarter under review, foreign outflow on the local bourse increased month on month, from N37.33bn in January to N40.88bn in February and N41.60bn in March.

On a year-on-year comparison, foreign outflow worsened by 236 per cent from N35.59bn at the end of March 2023 to N119.81bn in March 2024. In contrast, foreign inflow at the end of March stood at N93.37bn, driven by a 111.23 per cent increase between February and March 2024 to N52.66bn from N24.93bn.

The monthly report was collated from trading figures from market operators on their Domestic and Foreign Portfolio Investment flows.

According to the report, foreign capital inflow into the market has consistently increased since the beginning of the year, from N15.78bn in January to N24.93bn in February and N52.66bn in March, bringing the year-to-date inflow to about N93.37bn, which is about 415.29 per cent higher than N18.12bn inflows recorded for the same period in 2023.Total foreign transactions on the exchange stood at N213.18bn at the end of the quarter.
https://punchng.com/efcc-raids-speculators-as-naira-drops-to-1520/?amp

2 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by garriAndsugar: 11:41am On May 15
Tinubu is a plague sent to Nigeria

101 Likes 6 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Racoon(m): 11:42am On May 15
A super clueless government! Tinubu taxation government will never get sense.

64 Likes 3 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by maestro299: 11:44am On May 15
Clueless government. Propaganda cannot take us anywhere.

The way he was shouting 'emilokan' up and down, you'd think he was going there to do something meaningful. Every Nigerian president gives a brief period of of hope when they begin their administration before things go downhill. Tinubu is the only Nigerian president who didn't give the country a 'grace period'. At least Buhari still gave us like a year before he began to punish us. Tinubu right from the day of his inauguration had already started unleashing renewed shege on Nigerians. If this his supposed 'grace period' is as bad as this, imagine how it's going to be this time next year.

87 Likes 5 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Amigoss: 11:45am On May 15
So nor be binance and crypto again undecided U'wa Zaagha,uwagbeho!!!!! Ogun Kee dis govt and Apc

58 Likes 2 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by TotoIsGud4boy: 11:45am On May 15
Dumbos will raid this thread like EFCC to blame this current administration for the weak naira…. It’s like seeing this country fail gives them a high more superior to crack cocaine. Which gender complains the most ? Women!! That’s why the Agulu transgender with a feminine voice was sold on us and failed, hence the teeth gnashing and constant complains on this wonderful administration. Explaining to them the rot tinubu is cleansing in the system will be even easier to grasp by a 5yr old than this pathetic naysayers and sour losers suffering from yEAST infection. They’re still sensible people from the east tho, that despite being somewhat pessimistic just like all of us are (truthfully), still have hope in this administration and are willing to give Tinubu a chance, cos we’re sensible and good people with clean hearts.

5 Likes 2 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Kpartners: 11:45am On May 15
That will never solve the problem
We entered one chance, period

The raid will just excalate the problem, it will not bring dollar dawn

39 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by sofeo(m): 11:45am On May 15
So it's no more crypto disturbing Naira right?.

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Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by stagger: 11:45am On May 15
Fake news.

Were the reporters on ground to capture the arrests and know that they were speculators?

Nonsense!

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Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by DaddyCoool: 11:45am On May 15
Only our dear country.
Only Nigeria arrests people on the streets when their currency drops!
Canu imagine, say, US, arresting wall street traders or ANYBODY for that matter if dollar drops😆

38 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Rebuke: 11:45am On May 15
Raiders, continue grin

This government is clueless and trying every possible means to stay relevant.

Fuel has remained 1k and above in some places, what has Tinubus' government done about that?

Prices of goods are incredibly high because of the high cost of fuel and all they do is give gullible Nigerians false hope.

They have achieved their aim of keeping the price of fuel at 1k and as usual, Nigerians have adjusted to the new norm.

They keep chasing shadow while leaving the main issue behind.

Funny enough, some rat heads still support this government even when it's very obvious it's a clueless government.

39 Likes 3 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Jeon(f): 11:46am On May 15
In my place, two cups of garrison is 50 naira.
Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by crossfm: 11:46am On May 15
Hehehe.

One day market women will be arrested in Nigeria for causing the fall of naira grin grin.

The blame game continues.

39 Likes 5 Shares

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Lexusgs430: 11:46am On May 15
EFCC should stop chasing shadows.........

Naira is collapsing due to lack of economic activities + scarcity of forex ........

They should advice FG to fix the positions above ......

17 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Randal: 11:47am On May 15
Good
Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Emeka71(m): 11:47am On May 15
garriAndsugar:
Tinubu is a plague sent to Nigeria
Tinubu is actually doing more harm than good to our economy.

22 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by NinjaMetahuman: 11:47am On May 15
They keep chasing shadow.

They should go and raid Cbn head office that devalued naira to above 1450 for custom.

Nonsense.

20 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Gggjhhj: 11:47am On May 15
Ban binance, attack bdc, stop p2p for binance, stop p2p for kucoin, I no understand the colour of there problem, Dem go soon ban Whatsapp

22 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Bitojoe(m): 11:48am On May 15
When will this madness stop.....

3 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Everlastingson: 11:48am On May 15

9 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Nahunger(m): 11:48am On May 15
grin
Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by alizma: 11:48am On May 15
Ok
Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Throwback: 11:48am On May 15
Keep raiding, but prosecute and jail also.

Only foolish countries allow their citizens to hold a forex bank account within the local banking system, not to talk of allowing markets for forex trading in every nook and cranny of the country as though it is a food store.

What will it cost the government to shut down domiciliary bank accounts and any form of forex exchange outside of the banks and airports?

2 Likes 1 Share

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Afrobasic(m): 11:48am On May 15
Oh, so no be binance again? undecided

Incompetent government!

16 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by tnerro1(m): 11:48am On May 15
We don tire for this dollar news, people just want to survive this taxation government

2 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Ogonimilitant(m): 11:49am On May 15
Using Kinetic approach to bring down dollar is a very useless venture. This shows this Cadoso and Effcc chairman are just buch of illiterate.

You want use guns and bullet to bring down the value of Dollar.

grin

20 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Righthussle: 11:51am On May 15
Wetin remain na to kuku ban smart phones and laptops make #1 to be equals to 1$.



Mumu people.



That's was how they were chasing shadows too between 1985 to 1989 when naira went from #0.8 for 1$ to #7.39 for 1$.


1985 $1 = N0.894 (N1.70 Black Market Rate)

1986 $1 = N2.02 (N3.90 Black Market Rate)

1987 $1 = N4.02 (N5.90 Black Market Rate)

1988 $1 = N4.54 (N6.70 Black Market Rate)

1989 $1 = N7.39 (N10.70 Black Market Rate)

16 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Riosystem: 11:51am On May 15
We need to focus on manufacturing and production, and reduce our high level of importation.

5 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by princepee: 11:51am On May 15
Same tactics yet no results..
Raid BTC, chase aboki FX, attack binance.... let's put politics aside

And seek for a quality. CBN chair.
Oga governor is confused.

2 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by cmikel: 11:51am On May 15
[color=#770077][b]THE FACT IS THAT YOU ARE USING OUR FOREIGN RESERVE TO DEFEND THE NAIRA , YOU USE OUR EARNED FOREIGN RESERVE TO SUBSIDIZE THE DOLLAR PRICE AND SELL IT CHEAP TO BUEAURU DE CHANGE , MAKING IT AS IF NAIRA IS COMING DOWN MEANWHILE YOU ARE ONLY DOING SHORT CHANGING.


NOW THAT YOUR TRICKRY HAS COME TO THE OPEN , AND FOREIGN RESERVE IS BECOMING DEPLETED THERE IS NO MORE MONEY FOR YOU TO TAKE FROM THE RESERVE TO COMPLEMENT AND SELL DOLLAR AT A CHEAP RATE , NOW THE REAL SUITATION HAS SET IN DOLLAR IS GOING BACK TO THE ACTUAL MARKET PRICE BEACUSE YOU ARE NOW LACKING THE CAPACITY TO USE RESERVES TO DO SUBCISDIZATION ON IT.


IF THIS IS TRUE , ITS A PITY THE ONLY GAME YOU KNOW HOW TO PLAY ON THE CITIZEN IS TRICKERY AND PROPAGANDA.
WHICH ECONOMY GROWS BY TRICK AND PROPAGANDA?


THEY HAVE ADVISED YOU TO LOOK MORE INTO MAKING THE COUNTRY EXPORT DRIVEN BUT INSTEAD, YOU PREFER A SHORTCUT TO PROVE YOU ARE WORKING MEANWHILE YOU ARE PLAYING TRICKS WITH THE COUNTRY.



SOMEONE ONCE SAID YOU SHOULD ALL KEEP YOUR DOLLAR CLOSE , THIS IS BECAUSE THEY HAVE FIRST HAND INFORMATION OF THE TRICKS YOU ARE USING TO MAKE NAIRA LOOK STRONG.



WE ONLY NEED MEN OF INTEGRITY TO MAKE THINGS RIGHT IN THE COUNTRY NOT PEOPLE WHO JUST WANT TO OCCUPY POSITIONS













.




[/b]
[/color]

7 Likes 1 Share

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by Burruchaga71(m): 11:52am On May 15
N2000 loading.
What God can not do does not exist.

8 Likes

Re: EFCC Raids Speculators As Naira Drops To $1,520/$ by NothingDoMe: 11:52am On May 15
Lol. As usual.

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