Naira Gains against Dollar at Forex Markets

 The  naira appreciated against the dollar at the bureau de change and parallel markets yesterday. A survey conducted by the News Agency of Nigeria (NAN) in Lagos showed that naira traded at between N191 and N190 respectively at both markets, representing a gain of N2 to the dollar from the N193 and N192 it sold on December 24.

Before the traditional end-year closure of the Central Bank of Nigeria’s official market, the naira was stable at N168. It equally firmed up  against the Pound Sterling at the official market at N260.36.
Furthermore, it appreciated against the Pound Sterling at the BDCs, trading at N292, or a gain of N2 from the N294 it sold on December 24.
The naira was also sold at N293 to the Pound Sterling at the parallel market since December 24.

At the official market, it was sold against the Euro at N204.48, while exchanging against the Euro at the BDCs for N235 compared with N238 or gain of N3 from December 24.
The CBN had devalued the naira from N155/$1 to N168/$1. In addition, it had widened the band around the midpoint by 200 basis points from +/-3 per cent to +/-5 per cent.

Similarly, the CBN’s monetary policy committee had increased the monetary policy rate (MPR) by 100 basis points from 12 per cent to 13 per cent, while the cash reserve ratio (CRR) on private sector deposits was also raised by 500 basis points from 15 per cent to 20 per cent with immediate effect. But the CRR on public sector deposits was retained at 75 per cent, just as the net open foreign exchange trading position was left unchanged at one per cent.

The CBN governor, Mr. Godwin Emefiele, had attributed the pressure at the forex market to the dwindling supply of the United States dollars as well as a rise in the demand for the greenback.
Specifically, the CBN governor pointed out that the slide in crude oil price, which has led to a reduction of earnings to the country,  has also resulted to drop of US dollar inflow to Nigeria.
He said the central bank had spent huge assets from the foreign reserves during the year in ensuring that the official exchange rate was maintained at its previous value of N155/$1.

Source: ThisDay

Publish Date: 

Tuesday, 30 December 2014