TheNewsGuru

Tag: Forex

  • Naira holds steady at N1,586.15 against Dollar

    Naira holds steady at N1,586.15 against Dollar

    The Naira remained unchanged on Friday, closing the week at ₦1,586.15 to the Dollar at the official foreign exchange market.

    It traded at the same rate on Thursday, having gained ₦4.59 against the Dollar earlier in the day.

    Data from the Central Bank of Nigeria showed the Naira appreciated on Monday and Tuesday, trading at ₦1,583.73 and ₦1,579.40.

    However, the local currency slightly depreciated on Wednesday, trading at ₦1,590.74 against the Dollar.

    Since December 2024, the Naira has maintained relative stability due to Central Bank reforms and government fiscal support measures.

    These developments have been viewed as signs of growing investor confidence and improved foreign exchange liquidity.

    Analysts continue to commend the Tinubu administration’s bold reforms in the foreign exchange sector.

    They note that market liberalisation, rate unification, and greater transparency have strengthened the FX framework.

    President Bola Tinubu, in his second anniversary address on Thursday, highlighted the reforms’ positive impact on the currency market.

    “While FX revaluation raised our debt-to-GDP ratio to 53 per cent, debt service-to-revenue fell from 100 to under 40 per cent.

    “We cleared IMF debts and increased external reserves from $4 billion in 2023 to over $23 billion by end-2024,” he said.

  • Naira surges as forex reforms gain traction

    Naira surges as forex reforms gain traction

    The Naira appreciated by ₦4.59 against the U.S. Dollar on Thursday, closing at ₦1,586.15 at the official foreign exchange market.

    Data from the Central Bank of Nigeria’s website showed that the Naira recorded a 0.28 per cent gain, indicating a slight but consistent upward trend.

    On Wednesday, the local currency had exchanged at ₦1,590.74 to the Dollar, continuing its modest recovery from earlier volatility in the currency market.

    Earlier in the week, the Naira traded at ₦1,583.73 on Tuesday and ₦1,579.40 on Monday, reflecting improved demand and foreign currency inflows.

    Financial analysts attribute the currency’s recent gains to policy consistency and improved liquidity in the official foreign exchange market.

    There has been a notable increase in foreign exchange supply, believed to be driven by growing investor confidence and reforms introduced by the current administration.

    Experts believe that the Central Bank’s interventions, along with fiscal support measures, have played a vital role in calming speculative pressures.

    Analysts continue to applaud the bold reforms in the foreign exchange sector initiated by President Bola Tinubu’s administration.

    They argue that liberalisation of the FX market, removal of multiple exchange rates, and unification policies have contributed to greater transparency.

    The Centre for the Promotion of Private Enterprise (CPPE) said the FX reforms have had significant effects on the broader economy within Tinubu’s two-year tenure.

    According to the CPPE, improved investor sentiment and better market efficiency have been key outcomes of the administration’s economic strategy.

    Market observers suggest that if current momentum is sustained, the Naira may continue to strengthen in the medium term.

    However, they also caution that maintaining macroeconomic stability and curbing inflation are essential to preserving the gains recorded so far.

  • Ex-CBN Director proffers solution for stability of forex

    Ex-CBN Director proffers solution for stability of forex

    A former Director of Research Department, Central Bank of Nigeria (CBN), Dr Titus Okurounmu, has urged the Federal Government to make concerted efforts to increase domestic production to check foreign exchange volatility.

    Okurounmu, who gave the advice on Wednesday in Ota, Ogun, emphasised the need to increase the country’s domestic production to address the continuous rise in inflation rate and check foreign exchange volatility.

    According to him, if the country does not have anything to export, the exchange rate will continue to depreciate as there is no magic toward foreign exchange stability.

    “There is urgent need to increase domestic production, especially food production because the country has regular and constant rain to support farming system.

    “Also, the Federal Government needs to create critical infrastructure like stable power supply, good road network, amongst others.

    “That would help the manufacturing sector to produce at optimum level for both local consumption and export purposes,” he said.

    Okurounmu, therefore, called on the governors of the 36 states to use their monthly allocations on capital projects and increase domestic production in their various states.

    He also called on all tiers of government to fight corruption, saying that this had become the bane militating against economic growth.

  • Stop using forex as collateral for Naira loans, CBN warns bank customers

    Stop using forex as collateral for Naira loans, CBN warns bank customers

    The Central Bank of Nigeria (CBN) has warned bank customers to desist from using foreign currency as collateral for Naira loans.

    Acting Director, Banking Supervision Department of the CBN, Adetona Adedeji, gave the warning in a statement on Monday, in Abuja.

    Adedeji said that the current practice of using foreign currency-denominated collaterals for Naira loans would only be allowed in the case of Eurobonds issued by the Federal Government.

    He said that guarantees of foreign banks, including standby letters of credit would also be allowed

    “In this regard, all loans currently secured with dollar -denominated collaterals other than as mentioned above should be wound down within 90 days.

    “Failing which such exposures shall be risk-weighted 150 per cent for Capital Adequacy Ratio computation in addition to other regulatory sanctions,” he said.

  • How to practice your forex trading strategy: A comprehensive guide

    How to practice your forex trading strategy: A comprehensive guide

    The foreign exchange (Forex) market is the largest financial market in the world, known for its high liquidity and 24-hour trading operations. Success in Forex trading demands more than just understanding the basics; it requires a well-tested strategy and the discipline to stick to it. Practicing your Forex trading strategy is crucial to developing the skills and confidence needed to navigate the market effectively. Here’s a comprehensive guide on how to hone your Forex trading strategy.

    Understand the Fundamentals

    Before diving into practice here, ensure you have a solid understanding of Forex market fundamentals. This includes knowledge about how currency pairs work, understanding market analysis (both technical and fundamental analysis), and being up to date with global economic indicators that can influence currency values. Resources like Forex trading books, online courses, and seminars can provide valuable insights into the market’s workings.

    Use a Demo Account

    One of the best ways to practice your Forex trading strategy without risking real money is through a demo account. Most online Forex brokers offer demo accounts that mimic real trading conditions. These platforms allow you to trade with virtual money, providing a risk-free environment to test your strategy, refine your skills, and get comfortable with the trading platform. You can even get a mobile version by downloading a Forex trading app, allowing you to practice and make trades on the go.

    Develop a Clear Trading Strategy

    A clear trading strategy is paramount. Whether it’s based on technical analysis, fundamental analysis, or a combination of both, your strategy should outline what to trade, when to enter and exit trades, and how to manage risk. It should also align with your trading goals and risk tolerance. Common strategies include day trading, swing trading, scalping, and position trading. Experiment with different strategies in a simulated environment to find what works best for you.

    Keep a Trading Journal

    Maintaining a trading journal is an effective way to track your progress and refine your strategy. Record every trade, including the strategy used, entry and exit points, market conditions, and the outcome. Reviewing your journal regularly can help identify what’s working and what’s not, allowing you to make informed adjustments to your strategy.

    Backtest Your Strategy

    Backtesting involves applying your trading strategy to historical market data to see how it would have performed. Many trading platforms offer backtesting tools that can automate this process. Backtesting can provide insights into the effectiveness of your strategy over different market conditions and time frames. While past performance is not indicative of future results, backtesting can help identify potential improvements to your strategy.

    Start Small

    When you’re ready to transition from a demo account to live trading, start small. Use a micro Forex trading account to trade with small amounts of money. Starting small helps manage risk while gaining experience in live market conditions. It allows you to see how emotions like fear and greed can impact your trading decisions and learn how to manage them effectively.

    Use Risk Management Techniques

    Effective risk management is critical to successful Forex trading. This includes setting stop-loss orders to limit potential losses, only risking a small percentage of your trading capital on a single trade, and diversifying your trades. Practicing risk management techniques in your trading strategy helps protect your capital and ensures longevity in the Forex market.

    Learn from Professional Traders

    Learning from experienced traders can provide valuable insights into successful trading strategies and practices. Many professional traders share their knowledge through webinars, online courses, and social trading platforms. Social trading platforms, in particular, allow you to follow and copy the trades of successful traders, providing a practical way to learn and apply effective trading strategies.

    Stay Informed

    The Forex market is influenced by global economic events, including interest rate decisions, employment reports, and geopolitical developments. Staying informed about these events and understanding their potential impact on currency values is essential. Use economic calendars and follow reputable

    Review and Adjust Your Strategy Regularly

    The Forex market is dynamic, with changing market conditions and volatility. As such, it’s important to review and adjust your trading strategy regularly. Use your trading journal, backtesting results, and live trading experiences to refine your strategy. Be open to learning and adapting, as flexibility can be key to long-term success in Forex trading.

    Join Trading Communities

    Joining Forex trading communities can be beneficial for both beginners and experienced traders. These communities provide a platform to share experiences, strategies, and insights. Engaging with a community can offer support, motivation, and the opportunity to learn from a diverse group of traders. Look for online forums, social media groups, or local trading clubs to connect with other traders. These communities also commonly post valuable news that can tip you off to potential trades or give you an idea of what to look for in the future in terms of investor growth and profit.

    Practice Patience and Discipline

    Patience and discipline are vital qualities for Forex traders. Successful trading often involves waiting for the right trading opportunities to align with your strategy. Avoid the temptation to overtrade or deviate from your plan on a whim. Practice discipline in following your strategy and managing your emotions, especially during periods of loss or high volatility.

    Closing Thoughts

    Practicing your Forex trading strategy is a continual process that involves learning, testing, and refining. By understanding the fundamentals, developing a clear strategy, and utilizing tools like demo accounts and trading journals, you can build the skills necessary for successful trading. Remember, consistency and discipline are key. Stay informed, manage your risk, and be prepared to adapt your strategy as you gain more experience and insights into the market dynamics. With dedication and practice, you can navigate the Forex market with confidence and achieve your trading goals.

  • Recent forex stability commendable, says CBN gov, Cardoso

    Recent forex stability commendable, says CBN gov, Cardoso

    The Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, says recent stability achieved in the foreign exchange market is commendable.

    Cardoso said this on Tuesday in Abuja, while presenting the communique from the 294th meeting of the apex bank’s Monetary Policy Committee (MPC).

    According to Cardoso, the stability is a result of CBN’s recent policy actions and reforms, which are geared towards restoring investors’ confidence and attracting foreign investments.

    “The committee noted with satisfaction the level of stability achieved in the foreign exchange market in the last few weeks.

    “This, in the view of members, reflects the impact of the CBN’s recent policy actions and reforms, as well as increased transparency in the market.

    “In addition, the committee noted the efforts of the apex bank in offsetting verified foreign currency obligations, an action
    that will greatly enhance investor confidence and attract foreign investments to Nigeria,” he said.

    Cardoso said that the MPC also reviewed developments in the banking system and noted that the industry remained safe, sound and stable.

    He said that the apex bank would sustain its surveillance and ensure compliance of deposit money banks with existing regulatory and macroprudential guidelines.

    The CBN governor said that domestic headline inflation rose further to 31.70 per cent in February from 29.90 per cent in January.

    According to him, food inflation accelerated to 37.92 per cent
    from 35.41 per cent, while core inflation rose to 25.13 per cent from 23.59 per cent.

    “Key drivers of inflationary pressure remain the strong exchange rate
    pass-through to domestic prices; rising cost of transportation; high cost of energy and other production inputs.

    “Lingering insecurity, especially in food producing areas and legacy infrastructure deficits are also responsible,” he said.

    He said that the committee would continue to monitor developments in the global and domestic economies to ensure that inflationary expectations were anchored to restore and sustain macroeconomic stability.

  • CBN lifts FX restrictions on dairy products import to crash prices

    CBN lifts FX restrictions on dairy products import to crash prices

    The Central Bank of Nigeria, CBN, has lifted forex restrictions on the importation of milk and dairy products in the country, a move expected to push down prices.

    This was contained in a CBN circular with the reference number TED/FEM/PUB/FPC/001/010 dated March 12 to all banks.

    Zenith Bank further confirmed the development in a recent notice to customers.

    “Please be informed that the Central Bank of Nigeria (CBN), through its circular Ref No: TED/FEM/PUB/FPC/001/010, dated March 12, 2024, has provided an update on eligible items for foreign exchange (Non-Valid for FX),” the statement reads.

    “In light of the preceding, please note that the restriction on foreign exchange for importing dairy products and its derivatives to all entities except selected companies has been lifted.”

    Recall that on February 11, 2020, the CBN had added milk and dairy products to the list of items not eligible for forex.

    Meanwhile, on October 12, 2023, the apex bank announced lifting the ban on 43 items previously restricted from accessing forex.

    On Tuesday, the Naira appreciated to N1,560.57 per USD from N1,572.82 on Monday at the official forex market. This reduced the import duty exchange rate to N1,572.507 per USD on Tuesday from N1,593.41.

  • CBN reports increased forex inflow in February

    CBN reports increased forex inflow in February

    The Central Bank of Nigeria (CBN) has reported a significant increase in foreign exchange inflow into the economy in February.

    Acting Director, Corporate Communications Department of the CBN, Mrs. Hakama Sidi, said this in a statement on Friday in Abuja.

    Sidi said that the upsurge in forex inflow was recorded with marked increments in remittance payments by Nigerians overseas and purchases of naira assets by foreign portfolio investors.

    According to her, the apex bank’s data indicates that overseas remittances rose to 1.3 billion dollars in February, more than four times the 300 million dollars received in January.

    “Foreign investors purchased more than one billion dollars of Nigerian assets last month, with total portfolio flows of at least 2.3 billion dollars recorded thus far in 2024 compared to 3.9 billion dollars seen in total for last year,” she said.

    She said that higher forex inflows has continued in March, driven by increased investor interest in short-term sovereign debt following the recent adjustment to benchmark interest rates.

    She said that government securities issuances had been significantly oversubscribed, with foreign investors accounting for over 75 per cent of bids received at the auctions conducted on March 1 and 6.

    Recall that the CBN Governor, Mr Yemi Cardoso set out a detailed inflation-targeting strategy, using the last Monetary Policy Committee meeting in February.

    Cardoso also targeted exchange rate stabilisation, and strategies to spur confidence in the banking system and economy.

    He held a conference call with foreign portfolio investors to set expectations for sustained increases in Nigeria’s foreign currency reserves and improved liquidity in the foreign exchange market.

    According to him, all the different measures we have taken to boost reserves and create more liquidity in the markets have started to pay off.

    “When people understand the real issues and see a strategy and a plan, things tend to calm down.

    “Our objective today is to ensure that the market has supply, that the market functions, and that investors can come in and go out,” he said.

  • Forex: FG to raise $10bn for increased liquidity, Naira stability

    Forex: FG to raise $10bn for increased liquidity, Naira stability

    The Federal Government has expressed determination to raise at least 10 billion dollars to increase foreign exchange liquidity to stabilise the Naira and grow the economy.

    President Bola Tinubu made this known at the inauguration of the Public Wealth Management Conference organised by the Ministry of Finance Incorporated (MOFI) on Tuesday in Abuja.

    The theme of the conference was, “Championing Nigeria’s Economic Prosperity.”

    Represented by Vice President Kashim Shettima, Tinubu revealed plans by his administration to create millions of jobs by unlocking the value of Nigeria’s vast public assets.

    This, according to him, is to optimise and double the country’s Gross Domestic Product (GDP).

    He stressed the need to identify, consolidate and maximise returns on government-owned assets worth trillions of Naira.

    “The Federal Government set a goal to raise at least 10 billion dollars in order to increase foreign exchange liquidity, a key ingredient to stabilise the naira and grow the economy.

    “At the core of this is ensuring optimal management of the assets and investments of the Federal Government towards unlocking their revenue potential.

    “This includes our bold and achievable plan to double the GDP growth rate and significantly increase the GDP base over the next 8 years.”

    Tinubu, however, noted that decades of mismanagement and underutilisation have plagued the country’s assets, spread across Nigeria and outside its borders, leading to revenue losses that have hindered economic growth.

    The President gave the assurance that “the newly restructured Ministry of Finance Incorporated, which is to act as custodian and active manager of these assets, will now take the centre stage.”

    He emphasised transparency and accountability as key principles, believing that improved corporate governance, innovative partnerships and attracting alternative investment capital would significantly increase returns.

    “These improved returns will then be directed towards crucial funding for education, healthcare, housing, power, roads and other areas vital to lifting millions out of poverty.

    “And stimulating sustainable economic development and job creation for the youths.”

    Tinubu said that by efficiently managing public resources, the government aimed to build a more equitable society and unlock the full potential of its citizens.

    He called on all stakeholders, including ministries, development financial institutions and the public and private sector players, to partner with MOFI to optimise the strategic assets.

    He expressed hope that the collaborative effort would unlock Nigeria’s full potential and create a brighter future for all citizens.

    The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, said Tinubu was mindful of the pains of his administration’s reform programmes and was deploying appropriate mechanisms to address the challenges.

    He said that 42,000 metric tons of assorted grains were being released with 60,000 metric tons to follow shortly, adding that these are part of measures to arrest inflation and reduce food prices in the coming months across the country.

    He urged the management and board of the MOFI to develop a specific line of revenue for the national budget.

    This, according to him, is part of its renewed mandate of supporting the Federal Government’s fiscal stability.

    The Chairman of the MOFI Board, Dr Shamsudeen Usman, said that the MOFI would play a more active role in the management of assets under its purview.

    He urged operators of the assets to see MOFI as partners rather than competitors or regulators, adding that the new management was committed to high level corporate governance.

    Usman disclosed that the company had integrated a non-conflict of interest policy to guard against practices that undermine professionalism among members of staff.

    The Chief Executive Officer of MOFI, Dr Armstrong Takang, announced the launch of a N100 billion Project Preparation Fund as part of its renewed mandate of ensuring professionalism in the management of public assets.

    Takang said that the company would transform the fortunes of public assets and restore investor confidence in both the operations and management of the assets.

  • FG pledges to stabilise Forex

    FG pledges to stabilise Forex

    Following the recurrent freefall of Naira in the Foreign Exchange (Forex) market, the Federal Government has assured Nigerians that it will implement macroeconomic reforms to stabilise the market.

    The Minister of Information and National Orientation, Mohammed Idris, gave the assurance on Saturday in Minna, at the 2024 Press Week of the Niger State Chapter of the Nigeria Union of Journalists (NUJ).

    Idris said the government will implement reforms that will boost economic growth, curb inflation, ease the cost of living and stabilise the foreign exchange

    Represented by the Director-General of the Voice of Nigeria, Mallam Jibrin Baba Ndace, the Minister said, the year 2024 holds a lot of prospects for Nigerians as some of the promising initiatives of the administration begin to bear fruits.

    He said 2024 would be a great year for Nigeria as the  policies of President Bola Tinubu under the Renewed Hope Agenda take
    firmer roots for the growth of the nation’s economy.

    “The Tinubu administration will continue to implement macroeconomic reforms
    to achieve broad economic objectives of sustained economic growth.

    “The reforms will bring down inflation, ease the cost of living, stabilise foreign exchange
    and create jobs, among others,” he said.

    Idris said, against the backdrop of the withdrawal of fuel subsidy, liberalising the foreign exchange regime, and the fight against corruption, the Tinubu’ government
    is showing fidelity to the rule of law.

    According to him, the independence of institutions l, including the judiciary were demonstrated in the recent judgements of the courts.

    The Minister explained that the recent decision to relocate certain departments of the Central Bank of Nigeria(CBN) and the headquarters of Federal Airports Authority of Nigeria (FAAN) to Lagos is part of a broader strategy to enhance operational efficiency.

    He said the decision would also ensure a responsive financial system and cut operations cost.

    Idris emphasized that the government’s directive aligns with global best practices and has no political motivation what so ever as wrongly propagated.

    The Minister assured that no policy of the present administration would put any part of the country in a disadvantage position.