₦airaland Forum

Interesting.

Either na fake soldier or him don commit abomination.

.

No pics

I like the way you called those 2 posters at the end.

So which is the first church?

Did he marry all those chikitos he posed with.?

I hope this post enlightens Nairalander a bit on some of the pros and cons of devaluation or depreciation of Naira.

In a much anticipated press briefing the Central Bank Governor, Godwin Emefiele yesterday announced that the Monetary Policy Committee had taken a decision to effectively devalue the Naira from N155 to N168. This obviously is in response to the dip in oil prices and the run on our forex reserves which has seen the naira crash to as low as N182 this week. The CBN also took a decision to increase the Monetary Policy rate (MPR) to 13% from 12% which in financial terms is quite a huge jump. The MPR is the rate at which the CBN essentially lends money to banks and is in turn a benchmark for bank lending to the wider economy. The CBN also decided it was going to increase Private Sector Cash Reserve Requirement (CRR) to 20% from 15%. The CRR is a limit imposed on private sector deposits that the bank will have to keep with the CBN, effectively meaning they only get to lend out 80% of our deposits with them.

Just like many have asked me on twitter, in my blog and via messages, I am sure you must be wondering too, what does this all mean to me? How does it affect my savings, spending and investments? I will attempt to explain in plain terms.


I want to buy or sell forex

By devaluing the naira by a whopping N13 the CBN is basically telling the markets that it can no longer sell dollars at the Retail Dutch Market at its official price of between N155 – N160. The official rate is the rate sold to qualified importers and industries who rely on forex for business. Whilst the common man does not buy dollars from the RDAS we have the interbank market (a secondary market) and the parallel market as areas where we can buy dollars. For years the difference between the Official CBN rate and the Interbank has been about N5 whilst between the Interbank and black market has been about N5 thus keeping that margin at no more than N10 between the CBN rate and Parallel (black-market) rate.

PTA & BTA – For those looking to travel abroad and looking to buy dollars from the bank, the exchange rate for you is perhaps between N173 and N177 assuming the naira does not crash further. If you use our local debit and credit cards abroad, then you are essentially paying the same amount with the interbank rate.

Black Market Buyers – For those who prefer to buy or sell dollars at the black market, this new rule could only affect you if the naira crashes further. After all, the reason why the CBN decided to depreciate was because it could no longer hold on to that huge spread when the naira was still officially pegged at N155-160. Visitors into Nigeria who have dollars with them are set to benefit immensely. It means their money is worth much more now than before. Salary earners in dollars also earn more when they convert to Naira



I have a bank loan or I am looking to secure one

The increase in MPR as explained above, means the CBN has now effectively increased lending rate in the country. Usually when this occurs, commercial banks also increase their lending rate to borrowers. For those who have consumer loans such as car loans, mortgages, credit card debts, personal loans etc. don’t be surprised if your bank sends you a letter this week or next informing you of an increase in your borrowing cost.

This also extends to small businesses with loans that are kept at floating rates (changes with market conditions). The banks may decide to increase your borrowing rates depending on how they perceive your risk profile. Those who have dollar denominated loans are also heavily exposed to higher pay out especially if you took out a dollar loan even when you earn your income in naira. You income has now effectively reduced in dollar terms meaning you have to spend more to pay off your dollar loans.

What happens to my investment in Treasury Bills, Fixed and savings deposits?

The money market has been relatively volatile as investors reacts to the wave of economic news emanating out of Nigeria. With this MPC decision, particularly the one increasing MPR as well as CRR, I believe TB rates will increase in the primary market. If you got 10% for a 6 month treasury bills investment, then it might just increase to 12% in reaction to tightening liquidity. This off course depends on the diverse expectations of bidders for treasury bills. Fixed deposits from banks will also likely increase in response to the increase in CRR as well as increase in lending rate. You should attempt to renegotiate your rates with your bank to also reflect the current market conditions. Remember, the naira is worth less now in dollar terms so you need to grab as much value as possible.



What happens to my stocks?

Many believe the stock market has probably priced in the devaluation of the naira. This is because the stock market is like a leading indicator and reflects the mood of things to come before any other market does so. However, some stocks do come under scrutiny considering the outcome of the MPC meeting. Companies that have heavy dollar exposures are examples as they may need to incur higher forex cost by year end, if they had not hedged. Banking stocks also come under further pressure due to the increase in CRR as their Net Interest Margins may reduce thus affecting profits. However, it is thought that may be neutralized by gains in the forex market. Oil and gas stocks are also at risk of reporting lower earnings if the price of oil continues to slide further. This may not be market for short term buyers of equities, however long term buyers can find good bargain stocks.



Spending and family budget

As the year runs on, if it’s not unlikely that prices of goods and services will go up. Examples are foreign goods which most people rely on, gift items, baby products etc. Luxury items might also be even more expensive with the devaluation of the naira. The Nigerian economy is essentially dollarized due to our high taste for imports, so I won’t be surprised if things get more expensive. It may therefore be wise to buy your Xmas goods early enough as consignments coming in from next week will probably be more expensive when they are sold.



http://nairametrics.com/how-the-devaluation-of-the-naira-affects-your-money/

Bloomberg couldn't have put it any better. However on the aspect of devaluation of the Naira, the pros and cons have to be weighed intelligently else Nigeria would find itself in a much larger mess.

Before they said they are goats that want to eat yam, now they are mafia. Nigerians are really criminals according to the president.


Mrs Oyo Ita should go to the labour market, there are millions of unemployed Nigerian youth that can enter that budget office and do the work very well and neatly but no they won't because the like old old people.

God help Nigeria.

Both of them are just useless men. See face like wetin them wan take do sacrifice.

Seen

Obaf16:
Am one of them. Lol

Shhhhhh..... don't let anybody know

Terminator, Jackie chuck Norris, Bruce willis

Why do pregnant women always have that black vertical line on their belly when pregnant.. ladies enlighten me please.

ril19:
YOU! upon all your FTC today you still rush go comment first for your own thread.....you be winch?

Sorry no vess.

DollyParton1:
Yea. Just like your mama and sisters.

Same to you, your mama, sister and your daughters.

Operatives of Rapid Response Squad (RRS) of Lagos State Police Command and officials of the State Ministry of Health on Tuesday sealed off a fish depot for warehousing expired fish at Oba Akran Road, Ikeja, Lagos.
The depot, belonging to an Indian company, Premier Fish Product Limited, allegedly stored​ over N700​ ​million worth of expired fish.
The company had been under surveillance for about two weeks, the police said in a statement on Tuesday.
“The lid was finally blown yesterday by the operatives of the Rapid Response Squad, following a tip off from sources that the company was revalidating the expiry dates of the stock,” the police statement said.‎
The Lagos State health officials on Tuesday inspected four cold rooms of the company containing several tons of fish before sealing off the company.
An environmental health officer, Kuforiji Adebayo, who led officials from the Ministry of Health, said the state government was sealing off the cold room to pave way for thorough laboratory test of the fish found in the cold room.
“This place is being sealed off for health analysis,” Mr. Adebayo said.
“The samples of the consignment being taken are for laboratory analysis. What we have met on ground physically is highly suggestive of the fact that there are questionable practices here as most of the fish has expired.
“What we have established here is a deceit and fraudulent activity,” he said.
Mr. Adebayo also said they discovered the company was revalidating the expiry date of its products.‎
‎”What we have seen indicates the condition of the fish was not okay before being frozen. That is why there are blood stains in the cartoon of the fish.
“If the labels are being changed now, the impression it leaves is that the labels might have been changed before the investigations,” he said.
The company management, however, insisted it was not revalidating its products’ expiry dates, adding that the products – which are to expire in March 2016 – would be sold off before expiry date.
According to the depot manager, Sabir Alli, the stickers that littered the corridor to the cold rooms fell off because of the shifting of fish cartoons to create space for accommodation of new consignment.
The spokesperson of Lagos State Police Command, Dolapo Badmus, confirmed the incident, saying a staff of the company alerted the police of the development.
“We got a call that they were revalidating the products yesterday and we decided to swing into action.
“This was confirmed by a lot of the stickers found in the lobby with March 2016 as expiry date,” said Ms. Badmus.

http://www.premiumtimesng.com/regional/ssouth-west/198606-lagos-seizes-n700-million-worth-expired-fish.html?utm_source=&utm_medium=twitter

Terrible

Lol... Those lawyers know what they are doing. Bahd guys.

Seeing

princeonx:
Publicity? Do you even know the people we're talking about? They're popular already sir!

Remember the media hype last time peter and Paul had issues? Last year I think.

Slimbeth:
guy u lyk gud tin ooo.... dnt b greedy nw

Am not greedy, I know she is out there. There are millions of them in Nigeria just waiting to be discovered. I just want one, Dear God, I pray.

Lai Mohammed, who else.

8. A virgin, very beautiful, intelligent, hard-working, prayerful and honest.

As I was waiting for the page to load, "I braced myself up for another lai"

Hope it won't be a publicity stunt.

Thank God

Bestest...

Investment Is always good and Nigerians like party and marriage every week.