TheNewsGuru

Tag: Naira

  • Why Naira depreciates despite CBN’s intervention – Gwadabe

    The President, Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, has blamed the recent depreciation of naira on the speculators’ onslaught and resistance by the banking industry.

    Gwadabe told the newsmen on Saturday in Lagos that the refusal of some banks to sell the invisibles such as personal and business travel allowances frustrated naira recovery.

    The ABCON chief said that the CBN had recently accused the banks of frustrating its policies.

    He said it was ironical that the naira started losing strength in spite of the CBN’s review of the rates from N375 to N360 to a dollar.

    According to him, the naira started trading on Monday with a promising outlook for sustained strength against the dollar and other currencies, but it began to somersault at the middle of the week.

    “The naira ended deeper northward to close at N394 to a dollar on Friday, translating to 10 per cent depreciation of what was recorded during the week,’’ Gwadabe said.

    The association president said that the removal of disparity in applicable exchange rates among the BDCs, Travelex and the banks should have strengthened the nation’s currency.

    The financial expert said, “CBN’s knack for last minute solution as recent development has shown, accounted for the misfortune of the naira at the foreign exchange market.’’

    Gwadabe said that the battle for the soul of the naira would be won if the CBN could boost liquidity to the BDCs for effective unification of rates.

    “It is evident that the injection of liquidity to the interbank market rather than the BDC sub-sector is not effective and transparent for sustained FOREX rate convergence and unification.

    “Statistics from the CBN shows that about 20 banks get 80 million dollars weekly for invisible transaction as against the 20 million dollars weekly for over 3000 CBN licensed BDCs nationwide.

    “The CBN should enhance public awareness to guide end users on FOREX availability and applicable exchange rates.

    “The CBN should diversify the buffers from oil proceeds to foreign investors inflows and Diaspora remittances,’’ Gwadabe said.

    He urged the CBN to sponsor a bill for an act of the National Assembly for naira convertibility in West Africa, as part of the solutions to full recovery of the naira.

    Gwadabe said that naira was currently a means of exchange in about 15 countries in Africa.

    He urged the Federal Government to increase security surveillance at the nation’s airports and land borders to checkmate illegal foreign cash evacuation.

    TheNewsGuru.com reports that the naira ended the week on a negative note, eroding the 12.36 appreciation it recorded in its trading last week.

    The Nigerian currency appears to be on trial again, as experts argue that winning the battle for the soul of the naira requires more than pulling the monetary policy lever.

    They called for a blend of fiscal and monetary policy and indeed patriotism from all Nigerians to save the naira from further sliding.

     

    NAN

  • Again, Naira appreciates against dollar, now exchanges for N460/1$

    The Naira on Friday sustained its gains against the dollar as liquidity boost by the Central Bank of Nigeria (CBN) had forced a crash in the price of the greenback

    TheNewsGuru.com reports that the Naira exchanged at N460 to a dollar at the parallel market, gaining 40 points from N500 it recorded on Thursday.

    However, the Pound Sterling and Euro traded at N575 and N480 respectively.

    At the Bureau De Change (BDC) window, the Naira closed at N399 to a dollar (CBN controlled price), while the Pound Sterling and the Euro exchanged at N610 and N520 respectively.

    Trading at the interbank window saw the Naira close at N305.50 to a dollar.

    Traders at the market are however full of hopes that the Naira will sell for less than N400 to a dollar if the boost in liquidity by the CBN is sustained.

    Meanwhile, Alhaji Aminu Gwadabe, the President, Association of Bureau De Change Operators of Nigeria (ABCON) said that currency speculators were expected to lose billions of Naira to the new forex policy.

    Gwadabe said that speculators were already overwhelmed by the policy as they were taken by surprise by the move of the apex bank.

    TheNewsGuru.com reports that the new CBN policy directing banks to sell forex for school fees, medicals and other allowances was already impacting positively at the market.

     

    NAN

  • Naira appreciates at black market, now exchanges for N501/1$

    Naira appreciates at black market, now exchanges for N501/1$

     

    The central bank of Nigeria (CBN) new foreign exchange policy actions introduced has made visible impact on the exchange rate at the black market.

    The dollar tumbled from N525/$ to N501 on Wednesday since the recent intervention announced on Monday by the apex bank.

    Also, the buy rate for the greenback crashed on the parallel market yesterday to below N490 to the dollar, as foreign currency speculators who had held on to the dollar for several weeks rushed to sell off the currency in the wake of renewed confidence in the CBN’s ability to meet demand on the interbank market.

    Global ratings agency, Fitch Ratings on Wednesday said the new policy actions announced by the CBN, might ease some of the severe foreign currency liquidity pressure faced by banks in the country.

    Fitch said that the most important aspect of the CBN’s announcement was the plan to normalise the FX interbank market.

    It said in a statement that the intention of the CBN was to clear the backlog of overdue foreign currency obligations owed by banks to international creditors.

     

  • Again, Naira falls, hits N520/$1

    The naira tumbled to N520 against the United States dollar at the parallel market on Monday as scarcity of the greenback continued to keep the exchange rate in a free fall mode.

    The naira had closed at 516/dollar on Friday, after hitting 510/dollar and 507/dollar last Thursday and Tuesday, respectively.

    Experts said demand for dollar for school fees payment overseas as well as Personal Travel Allowance by intending travellers was taking a toll on the exchange rate at the parallel market.

    This came just as retail currency traders tried to digest the Central Bank of Nigeria’s new decision to sell dollars to retail users through commercial banks, Reuters reported.

    The CBN is planning to sell $1m weekly to each of the country’s 21 commercial banks at a rate of N375 to clear a backlog of demand for retail users and try to narrow the premium between the official and black market rates.

    Retail currency users buy dollars from licensed Bureaux de Change operators. However, due to the CBN’s inability to meet dollar demand, the BDCs have tended to source dollars from private sources and resell at a much higher margin, fuelling the black market.

    Forex traders told Reuters that some banks had compiled a list of bids from customers awaiting dollars.

    The CBN has been selling dollars at N305 to clear a backlog of demand from manufacturing, agriculture and airline companies, hoping also to help drag the country out of its worst recession in 25 years.

    Experts are divided over the outlook for the naira this year. Some experts have said the naira may hit between 520/dollar and 1000/dollar at the parallel market this year unless the CBN reviews its forex policy.

     

  • Naira depreciates further against dollar, now exchanges for N506/$1

    Naira depreciates further against dollar, now exchanges for N506/$1

    The Naira reached its climax in its drop of value against the dollar on Friday (today) as it now exchanges for N506 to a dollar as against its initial exchange rate of N500 to a dollar recorded on Thursday.

    The free fall of the Naira against the Dollar appears unstoppable as the Nigerian currency traded for N506 to $1 down from N500 recorded on Thursday, February 9, 2017.

    Against the British Pounds Sterling and the European Euro, the Nigerian Naira weakened to N617 and N531 respectively down from the N615 and N530 recorded the previous day.

    However, on the official market, it remained at N305.25 to dollar, where it has been trading since last August.

    The latest crash of the Naira is the worse in the History of the country.

    The Head of Africa Research, Standard Chartered Bank, Razia Khan, blamed the fall on scarcity of foreign currency in circulation. She said: “Despite rising FX reserves, it’s the amount of the FX that is supplied that matters. The parallel market, by its nature, is particularly sensitive to demand-supply imbalances, and has a tendency to overshoot,”

    TheNewsGuru.com recalls that last week, the Central Bank of Nigeria sold $660m in three and five-month currency forwards at an auction aimed at clearing a backlog of dollar demand but traders stated it was not enough to satisfy the market.

  • Naira appreciates, exchanges for N498/1$ as external reserves hits $28.28bn

    Naira appreciates, exchanges for N498/1$ as external reserves hits $28.28bn

    The Naira on Wednesday exchanged for N498 to $1 after depreciating in value to N500 at the parallel market for close to some weeks now.

    However, the external reserves also rose marginally to $28.28billion to reach the highest in the year.

    The naira remained stable at N305.25 to the dollar at the interbank market, however, on the website of the Association of Bureau de Change Operators; the naira was quoted at N315.38 to the dollar.

    Demand for the greenback grew and the Central Bank of Nigeria rationed dollar supply, having sold $660 million in 3- and 5- month currency forwards at an auction aimed at clearing a backlog of dollar demand. Traders however said the dollar sale was not enough to satisfy the market.

    Data on the website of the apex bank showed that the nation’s external reserves has risen by 7.89 per cent since the beginning of the year. Traders said while the apex bank has been selling dollars on the official market to support the naira, dollar shortages were causing the naira to weaken on the black market.

     

  • Again, Naira exchanges for N500/1$ at parallel market

    The Naira on Friday depreciated further to N500 to a dollar at the parallel market after it had remained stable for nearly three weeks.

    The Pound Sterling and the Euro traded at N616 and N530 respectively at the open market.

    The Nigerian currency, however, remained stable at the Bureau De Change (BDC) segment of the market exchanging at N399 to a dollar, while the Pound Sterling and the Euro closed at N617 and N527, respectively.

    The Naira also remained stable at the interbank window exchanging at N305.25 to a dollar.

    Traders at the market said that the scarcity of the greenback was far from being over.

    TheNewsGuru.com recalls that the Naira had on Monday exchanged for N500 to 1 dollar at the parallel market from N498 that it sold for over the weekend.

     

     

  • Naira extends stability at major forex market

    Naira extends stability at major forex market

    The Naira on Tuesday continued to extend its stability against the dollar at all the major segments of the forex market.

    At the parallel market, the Naira exchanged at N498 to a dollar, while the Pound Sterling and the Euro traded at NN615 and N525, respectively.

    Trading at the Bureau De Change (BDC) window saw the Naira exchanged at N399 to a dollar, Central Bank of Nigeria (CBN) controlled rate, while the Pound Sterling and the Euro closed at N616 and N527 respectively.

    The Naira also remained stable at the interbank market as it traded at N305.25 to a dollar.

    Alhaji Aminu Gwadabe, the President, Association of Bureau De Change Operators of Nigeria (ABCON), said that the increase in the nation’s external reserves and the global fall in the dollar contributed in the Naira stability.

    Gwadabe said that ABCON had also embarked on a sensitisation campaign to enable its members operate by the rules.

     

    NAN

  • Foreign exchange inflows into Nigeria falls in 2016

    Foreign exchange inflows into Nigeria falls in 2016

    The total Foreign Exchange inflows into Nigeria falls at 46.86 per cent in 2016, the lowest value since the series started in 2007, a new set of data released on Wednesday by the statistics office.

    The report shows that Nigeria receives capital importation totaling 5.12 billion Dollars in 2016 lower than 9.64 billion Dollars inflow in 2015.

    The decline cuts across direct, portfolio and other investments into Africa’s largest economy in 2016 when the economy went into a recession and the value of the local currency became lower than 40 percent.

    The report says that the total portfolio investment was down by 69.81 percent but the Foreign Direct Investments was 27.83 per cent between 2015 and 2016.

    Meanwhile, other investments portfolio increased by a mere 3.48% in 2016 was due to increase in loans.

     

  • Naira exchanges for N500 to $1

     

    The Naira on Monday continued its free fall against the United States Dollars at the parallel market as it exchanged for 500 from 498 that it sold for over the weekend.

    The currency thus crossed the critical threshold analysts had predicted.

    At the official market, the local unit closed at 305/dollar, the level it has traded at since August last year.

    The CBN had two weeks ago commenced sales of dollars to the BDC operators through Travelex, following a three-week break during the Christmas and New Year celebrations.

    On Friday, the naira closed at 498/dollar at the black market, broadly unchanged from 497/dollar it recorded the previous weekend.

    “Confidence is gradually returning to the forex market as a result of improved foreign exchange reserves, dollar sales by international money transfer agents and the central bank assurance it will continue to support the local currency,” one trader told Reuters.

    TheNewsGuru.com recalls that the CBN as at last Tuesday said it would continue to provide hard currency, with priority given to manufacturing industries that need to import raw materials and spare parts.