The Naira recorded an appreciation of 12.36 per cent at the parallel market in the last one week, the News Agency of Nigeria (NAN) reports.
NAN reports that the Naira traded at N440 last Monday while it closed at N390 to the dollar on Friday.
In the week under review, experts commended the Central Bank of Nigeria (CBN) for its intervention at the foreign exchange market, but appealed to the apex bank to eliminate the multiple rates in the market.
As the Naira continues to appreciate, experts say it is necessary for the CBN to adjust applicable rates in different segments of the market in the overall interest of the economy.
Alhaji Aminu Gwadabe, President, Association of Bureau De Change Operators of Nigeria (ABCON), said CBN-licenced BDCs incurred regulatory losses of N130 million in the week under review.
Gwadabe told NAN that the losses came from the CBN’s disparity in applicable exchange rates among players in the market.
According to him, the public has refused to buy foreign exchange from BDCs for invisibles such as medicals, school fees, and personal and business travel allowances at a rate above N375 to the dollar.
The financial expert urged the CBN to promptly address the issue.
NAN further reports that the CBN had injected over 1.5 billion dollars to the interbank market since it started its intervention in February.
Stakeholders hope that the sustenance of the CBN’s efforts at the interbank market will further drive down the value of the dollar. (NAN)
Tag: Naira
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Naira gains 12.36 % in one week
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Naira consolidates strength against dollar
The Naira on Friday in Lagos consolidated its position against the dollar at the parallel market, the News Agency of Nigeria (NAN) reports.
The Nigerian currency on Friday afternoon exchanged between N380 (buying rate) and N390 (selling rate), stronger than N400 recorded on Thursday, while the pound sterling and Euro closed at N490 and N430.
At the Bureau De Change (BDC) window, the Naira was sold at N399 to the dollar, while the pound sterling and the Euro were sold at N500 and N400.
The Nigerian currency appreciated at the interbank market, closing at N307 to the dollar, from N308 posted on Thursday.
Traders at the market said liquidity boost at the interbank market by the CBN was fast forcing the rate down at the market.
Meanwhile, Alhaji Aminu Gwadabe, the President of the Association of Bureau De Change Operators of Nigeria (ABCON), said CBN-licenced BDCs would incur regulatory losses of N130 million this week.
Gwadabe told NAN that the losses were coming from CBN’s disparity in applicable exchange rates among players in the market.
According to him, the public has refused to buy foreign exchange from BDCs for invisibles such as medicals, school fees, personal and business travel allowances at a rate above N375 to the dollar.
The financial expert urged the CBN to promptly address the issue.
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Naira: Senator commends CBN over bullish intervention
A member of the National Assembly, Sen. Hope Uzodinma, has commended the Central Bank of Nigeria (CBN) for its effort at strengthening the Naira against the dollar.
Uzodinma, who represents Imo West Senatorial District, told the News Agency of Nigeria (NAN) in Abuja that the recent appreciation of the naira was commendable and should be sustained to put the economy back on track.
He called on relevant stakeholders, including government agencies, to support the CBN in taking further measures that would check the exchange rate.
“The Central Bank of Nigeria must be supported in its efforts at bringing down the foreign exchange rate and make Naira stronger.
“If trade facilitation is to be realised, if business will blossom in Nigeria, we need a strong currency and the key to any strong economy is predominantly based on the value and concept of the exchange rate.
“So, if our local currency is strong, if our purchasing power is strong, it means that our economy will be strong.
“The only way this can happen is to support the current effort of the Central Bank of Nigeria to encourage them to ensure that the exchange rate for US dollar to a naira will come up.
“Government has a responsibility to support our policy managers and economic managers in their various policies.
“Whatever has made the exchange rate as at today to be better than few weeks back, we have a responsibility and a duty as a matter of fact to support it,’’ he said.
Uzodinma, who is the Chairman, Senate Committee on Customs, Excise and Tariff, urged the CBN to ensure that commercial banks complied with foreign exchange guidelines, particularly on import and export.
“The guidelines as produced by the CBN are very straight and strict.
“But, what has happened over the years, why is the government revenue missing, is it because of poor monitoring?
“If the commercial banks, the importers and exporters are made to comply with the foreign exchange rate, the comprehensive import supervision scheme will be able to produce the expected result,’’ he said.
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Naira recovers to N385/$ in black market
The naira yesterday regained its strength as it exchanged at N385 to dollar in the parallel market.
Bid-offer spread widened as much as N15 on the black market after the currency gained 4.9 per cent on Wednesday to a seven-month high. It firmed to as much as N385 on the black market. Others quoted N406 to the dollar. On the official market, the naira was quoted at N308 per dollar on Thursday and traded with a spread of N0.50.
The naira recovery came after more than $1.4 billion interventions by the Central Bank of Nigeria (CBN) in the interbank market.
President, Association of Bureaux De Change Operators of Nigeria (ABCON) Aminu Gwadabe, said he expected the naira to stabilise around N380 to N400 to the dollar, but added that the CBN must review the multiplicity of rates.
Also, the gap between what traders bid and offer for the naira on the black market has widened following a series of CBN’s interventions on the official market.
Traders are trying to hedge against losses after the currency firmed sharply during previous session. The central bank has been intervening on the official market in recent weeks to narrow the official currency spread with the black market rate. The CBN offered to sell $100 million in currency forwards yesterday.
“Everyone is hedging their bets. We bought the dollar as high as N500 and we don’t know where the rate is going,” one black market trader, known as Salisu said.
Central Bank Governor Godwin Emefiele on Tuesday said speculators betting on a naira fall “are taking a risk and will lose”.
He added that he expects the black market rates to narrow further. Bid-offer spread on the black market was N5 before those comments.
The bank has also been weakening the naira on the official market to converge rates, traders say. But has said the weakness was not a devaluation and it has not provided a target rate.
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Dollar records further loss, sells for N390 at parallel market
The value of the Dollar continued to diminish against the Naira as the Nigerian currency was traded at N390 on Thursday in Abuja.
The News Agency of Nigeria (NAN) reports that the Naira had also appreciated against the Euro, exchanging at N400 while remaining stable against the Pound Sterling at N465.
The last time the naira traded at between N390 and N400 to the dollar at the parallel market was in August 2016.
With the gains made by the local currency in the last five weeks, the naira inched closer to one of the Central Bank of Nigeria’s (CBN) key foreign exchange policy objectives of an exchange rate convergence.
On Wednesday, when the dollar traded for N400, it marked the beginning of true convergence of official and black market foreign exchange rates.
At the Foreign Exchange (FX) interbank market, the naira traded for N375 to the dollar for invisibles and N307 to the dollar for manufacturers and importers of raw materials eligible to buy Forex from the segment of the market.
The significant gains made by the naira at the parallel market, according to market analysts, is a reflection of the improved confidence in the Forex market following the sustained dollar interventions by the CBN since February.
A Bureau de Change (BDC) operator, who preferred anonymity in Abuja, told NAN that the gains made by naira over the dollar were due to CBN’s continued flooding of the market with dollars while there were very few or no customers to patronise them.
He said several retail customers who used to resort to the BDCs, which indirectly funded the parallel market, to fund invisible transactions now bought dollars at a lower rate from the banks.
In all, the Central Bank has auctioned a total of 1.9 billion dollars through forward sales as well as targeted intervention for invisibles.
This amount does not include its daily intervention of 1.5 million dollars on the interbank market.
The CBN Governor, Mr Godwin Emefiele, on Tuesday expressed optimism about the convergence of the Forex rates at the official and parallel markets, stating that the gains made by the naira against the greenback in the last five weeks were not a fluke.
Emefiele said he was happy that the central bank’s intervention was yielding positive results.
“I am happy, indeed very gratified, that the interventions have been positive; we have seen the rates now converging and we are strongly optimistic that the rates will converge further.
“In terms of sustainability, I think it is important for us to say that the foreign reserves at this time are still trending upwards to almost 31 billion dollars as I speak with you.
“The fact that we have done this consistently for close to five weeks should tell everybody, or those who doubt, the strength of the central bank to sustain this policy.” (NAN)
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Naira sells at N400 to dollar
The Naira on Thursday was sold at N400 to a dollar at the parallel Market, the News Agency of Nigeria (NAN) reports.
The Nigerian currency gained N10 to close at N400, from N410 posted on Wednesday, while the Pound Sterling and the Euro traded at N500 and N430 respectively.
At the Bureau De Change (BDC) window, the Naira closed at N400, while the Pound Sterling and the Euro traded at N530 and N465 respectively.
Trading at the interbank market saw the Naira weaker at N308.00 from N307.75 recorded on Wednesday.
Currency traders expressed the hope that the continuous appreciation of the Naira would affect the economy positively.
Meanwhile, the Association of Bureau De Change Operators of Nigeria (ABCON) has urged the Central Bank of Nigeria (CBN) to loosen its policies on foreign direct inflow and Diaspora remittances as part of efforts at rate convergence.
ABCON President, Alhaji Aminu Gwadabe said that recent development in the FOREX market had made it important for the CBN to review the rate at which it sells FOREX to BDCs.
Gwadabe explained that a fair playing ground for all operators at the FOREX market was needed for the CBN to achieve its goal for rate convergence at the market. (NAN)
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Naira gains N20 against dollar
The naira appreciated significantly against the dollar on Wednesday to trade at N410 to the dollar, the News Agency of Nigeria (NAN) reports.
The local currency gained 20 naira to exchange at N410 to the dollar from N430 posted on Tuesday.
It also firmed against the pound sterling and the Euro as it was traded at N510 to the pound and 435 to the Euro from N530 and N450, respectively.
At the Bureau De Change (BDC) window, the naira was sold at N400 to the dollar, while it closed to the pound sterling and the Euro at N530 and N465, respectively.
Transactions at the interbank market saw the naira closed at N307.75 to the dollar.
Traders expressed mix-feelings over the development in the market on Wednesday.
Mr Yahya Mohammed, a trader, said the new development had raised his optimism that naira could sell for N350 against the dollar tomorrow.
Meanwhile, the new development has put the BDC sub-sector into a very tight corner as some of their clients were no longer comfortable with the prevalent rate.
Alhaji Aminu Gwadabe, President, Association of Bureau De Change Operators (ABCON), said BDCs were facing increasing resistance from their clients.
“Some of them insist they can only patronise us at N375 to a dollar,’’ Gwadabe said. -
Naira continues to appreciate against dollar
The Naira has continued to appreciate against the dollar at the parallel market, the News Agency of Nigeria (NAN) reports.
The Nigerian currency on Tuesday afternoon traded at N420 (buying rate) and N430 (selling rate), while the Pound Sterling and the Euro closed at N530 and N450 respectively.
Trading on the floor of the Bureau De Change (BDC) showed that the Naira closed at N400 to a dollar, while the Pound Sterling and the Euro traded at N545 and N480 respectively.
The Naira remained stable at the interbank market, exchanging at N307.50 to a dollar.
Traders at the market said that they were happy with the performance of the Naira at the market, adding that it would lead to the fall in the prices of goods and services nationwide.
Meanwhile, Mr Emefiele Godwin, Governor of the Central Bank of Nigeria (CBN), said that the bank was optimistic to see the further convergence of the official and parallel market rates.
Emefiele said this, while fielding questions from newsmen at the end of the two- day Monetary Policy Committee (MPC) meeting of the CBN in Abuja.
“We are determined to see a greater convergence of the official and parallel market rates,’’ Emefiele said.
NAN reports that the CBN retained the lending rate at 14 per cent and other monetary policy parameters.
The CBN has recorded huge success at the FOREX market since it started injecting over 1.5 billion dollars at the interbank market.
The Naira has continued to firm against the dollar in defiance of predictions by some experts that it would sink to N1,000 to a dollar by the second quota of the year. (NAN)
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Naira sells at N440-N445 per dollar
The Naira on Monday continued to extend its gains against the dollar at the parallel market, the News Agency of Nigeria (NAN) reports.
The Nigerian currency exchanged at N440 (buying rate) and N445 (Selling rate) to a dollar, from N445/N450 it traded on Friday, while the Pound Sterling and the Euro closed at N530 and N465.
At the Bureau De Change (BDC) window, the Naira exchanged at N398 (buying rate) and N400 (selling rate), while the Pound Sterling and the Euro closed at N545 and N480.
Trading at the interbank market showed that the Naira closed at N307.50 to a dollar.
Traders at the market said they were happy with the level of liquidity but appealed to the Central Bank of Nigeria (CBN) to sustain it to further reduce the gap between the official and parallel market rates.
Meanwhile, Prof. Sherifdeen Tella, a Senior Economist at the Olabisi Onabanjo University, Ago Iwoye, Ogun, has said that injecting dollars into the interbank market by the CBN is not sustainable.
“I don’t think that injecting dollars into the interbank market is a permanent solution to the challenges at the FOREX market.
“It is only a temporary measure,’’ Tella said
The don, who noted that speculators were the major drivers of volatility in the FOREX market, said that the CBN should change the colours of the N1000 and N500 notes to force them to bring out the currencies in their coffers.
Tella called for a reduction in the benchmark interest rate by the Monetary Policy Committee (MPC) meeting of the CBN, to enable startups to borrow money to finance their businesses.
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Naira to appreciate further as CBN boosts forex sale
The Naira is set to appreciate further this week as the Central Bank of Nigeria (CBN) plans to inject more Foreign Exchange (Forex) into the market to meet the requests of genuine customers.
CBN spokesman Isaac Okorafor, gave the assurance yesterday.
The News Agency of Nigeria (NAN) reports that the apex bank had so far kept to its promise of continuing to supply enough forex to guarantee liquidity in the market.
Okorafor said the bank was committed to ensuring that authorised dealers got sufficient supply to meet the demands of authentic customers of banks.
He adde that the bank had since February offered over one billion dollars to the interbank market, and expressed optimism that stability had been restored to the forex market.
He said individuals could easily access forex to address personal and business allowances.
A summary of the CBN intervention in the interbank market over the past two months showed that the highest bid rate was N360 per dollars, while the lowest was N315 per dollar.