A number of public policy initiatives have been put in place by the federal government to strengthen the nation’s economy. One of such is the introduction of the finance bill to boost the financial standing of the country. How far can the bill go in attaining this objective? A close look into this piece of legislation shows that it is really worth Read More
Foreign exchange crisis in the country has pushed down the participation of foreign investors in Nigeria’s stock market to a meagre 16.8 per cent, according to information sourced from the NGX website. As at the time of compiling this report, the exchange rate between the naira and the dollar fluctuated between N444 and N446 to the dollar at the official Read More
The naira appreciates at the beginning of the week with increase in foreign exchange (FX) inflows, thus reducing demand pressure at the Investors and Exporters window.
The battle to save the naira has been ongoing, and the latest move to redesign some notes is expected stem the local currency from its persistent depreciation, according to foreign currency analysts.
Weak local currency, coupled with a rising inflation rate has weakened purchasing power of the naira, affecting both corporate and individual finances. At the investors’ and exporters’ FX market, the Naira gained 0.37 per cent against the US dollar, rising to N444.7 from N446.33.
According to Market Forces, Africa, the parallel market rate, however, remained constant at N775 ahead of the 2023 election. Consequently, the gap between the official and black market rates is collapsing fast after spurious demand pushed the exchange rate curve higher in recent weeks.
Lower foreign currency inflows remain top issues combating naira stability but it is unlikely to go away on account of the import-dependency of Africa’s largest economy by gross domestic product size.
Despite higher global oil prices, Nigeria has failed to position itself strongly as exporting country due to a bottleneck in crude production; including oil theft among others.
Higher oil prices at the global level are fast reducing due to changing dynamics and instability in major economies – due to partial economic lockdown in China and Russia-Ukraine war.
On Monday, Brent crude price dipped 3.06 per cent to $81.07 a barrel. Meanwhile, WTI crude oil fell 2.59 per cent to $74.30 per barrel as a result of widespread street protests in China over the country’s strict COVID-19 policy.
The United States granted Chevron Corp a license to produce oil in Venezuela, dampening investors’ expectations for increased energy demand in the near future. FX market data show that the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate traded within the range of N431.0-447.5 but closed at N446.33 last week.
This translates to a depreciation of -0.1% or N0.7 week on week. In the forwards market, the naira traded within the range of N447.0-465.8 per greenback in the foreign exchange market.
In the retail secondary market intervention sales (SMIS) market, the FX spot rate remained unchanged to close at N445 per dollar on Friday. As the naira holds strong across markets, the gap between the NAFEX and the parallel market rate has collapsed near 70 per cent.
According to data from FMDQ, NAFEX turnover increased by 20.5weeks $118.9 million on Friday, Coronation Research said in a market note.
Last week, analysts said the NAFEX window recorded an inflow of $126 million with the Central Bank of Nigeria accounting for 6.4 per cent, foreign portfolios investors (FPIs) accounting for 1.1 per cent, non-bank corporates accounting for 35.7 per cent, exporters accounting for 47.8 per cent, and others accounting for 9.0 per cent, according to a market report.
Meanwhile, the naira appreciated against the Chinese Yuan (CNY), according to data from the CBN, up +0.2 per cent to close at N62.2.
The Naira, on Wednesday, appreciated against the dollar at the parallel section of the foreign exchange market amid increased liquidity. The exchange rate still varies largely across the markets based on the location and volume of transactions. In a conversation with some traders at the International Airport Lagos, they are selling dollars at the rate of N840/$1 for cash transactions, Read More
In a move to address the bottlenecks in availability of foreign exchange (forex), particularly the dollar, the Central of Nigeria (CBN) has empowered special purpose bank to accept deposits from individuals and small businesses, under the cover of the deposit insurance scheme to carry out payments and remittances through various channels in the country. The new ‘vehicle’ known as Payment Read More
Despite Nigeria’s trades with other countries preceding its independence, it is yet to have an official trade policy that guides its trading activities; BENJAMIN UMUTEME notes. Trade, which is basically an exchange, is voluntary in nature between two parties in need of each other’s resources i.e. goods and services. In other words, it is a fulfillment of desires by two Read More
The total value of domestic and foreign transactions on Nigerian Exchange Limited (NGX) for the first five months of the year 2022 has rose to N1.506 trillion. This record shoots higher against N933.65 billion, which was the total transactions carried out by both domestic and foreign investors in the corresponding period of January to May 2021. In a report released Read More
Analysts have blamed declining capital importation into the country on poor management of Foreign Exchange (forex) and the inflation rate as at September 2021. The importation of capital in the first nine month of 2021 dropped by $4.08 billion (N1.68 trillion). During this period, Foreign Portfolio Investment (FPI) contributed the most significant amount to capital inflows, accounting for $4.31 billion Read More
Foreign portfolio investments in Nigerian stock market dropped by 40.4 per cent in 2021 to its lowest level in five years as the active participation of foreign investors in Nigerian market declined by 11 percentage points from about 34 per cent of total market transactions in 2020 to about 23 per cent in 2021. The full-year foreign portfolio investments (FPI) Read More
The Executive Director of National Export Promotion Council (NEPC), Olusegun Arowolo has urged Nigeria to tap into the $150 billion global organic market by giving attention awareness to Ecological Organic Agriculture. Arowolo who was represented by Mr Williams Ezeagu stated this on Tuesday, in Abuja at the 3-day National Organic Agriculture Business Summit NOABS 2021. He assured that organic certified Read More
Regrettably, naira depreciation does not hold any assurance of better things economically for Nigerians. There is obviously misguided and unrealistic call that the naira be devalued in expectation that matching “official rates with parallel market exchange rates will attract foreign investors or ensure competitiveness of the Nigerian economy”. Conversely, foreign investors are ‘smart guys’ investing chiefly in economically and minimally Read More
One of Nigeria’s lenders, Fidelity Bank Plc has reiterated its commitment to strengthening Nigeria’s non-oil export sector with the commencement of its Export Management Programme (EMP). It would be recalled that the bank in 2016, in partnership with the Nigerian Export Promotion Council (NEPC) and the Pan-African University (PAU) launched the Export Management Programme (EMP). The programme, which is scheduled Read More
The National Union of Charcoal Exporters (NUCE) has expressed deep worry over the continued ban on the exportation of charcoal, saying charcoal export was a major contributor to the Nigeria’s economy. This was the bone of contention at the meeting convened by the union in collaboration with the Federal Ministry of Industry, Trade and Investment in Abuja The director, Commodities Read More
The Nigerian naira hit a record low of N573 against the dollar on the black market on Monday, shrugging off news of the country’s Eurobond sale, meant to boost its currency reserves, traders said, weighed by a recent clampdown on retail forex operators. The West African country sold $4 billion via Eurobonds last week after investors submitted bids of $12.2 Read More
When the Central Bank of Nigeria (CBN) restricted the sale of foreign exchange to BDCs, many thought that continuous slide of the country’s currency against the Dollar would cease, but alas, it is not to be as the slide has continued. In this piece, BENJAMIN UMUTEME looks at the implication of a weakened Naira on the nation’s economy. Alarm bells Read More
The North-South Economists’ Forum (NSEF), a focus group of development economists has exonerated Godwin Emefiele, governor of the Central Bank of Nigeria for the continued depreciation of Naira, blaming it on the low receipts from the sale of crude oil and the non-export status of the Nigerian economy. The body of economists, in a press statement signed by its Chairman, Read More
The Federal Government of Nigeria has announced plans for a Eurobond issuance in theInternational Capital Market (ICM). The last time Nigeria accessed the ICM was NovemberVirtual meetings with investors have been scheduled for September 17 and September20, 2021. In order to avail local investors the opportunity to invest in the Eurobonds, meetingswill also be held with local investors. This is Read More
The Nigerian currency continues its free fall against the US dollar on the black market, as it exchanged at N565 per $1 on Thursday. Thursday’s rate indicates Naira dropped N3 at the black market when compared to the N562/$1 it traded on Wednesday. At the same market, the Nigerian currency depreciated against the Euro by N3 to close at N648/€1 Read More
This article is a reaction to the Association of Bureau De Change Operators of Nigeria (ABCON) press released in Lagos that was widely reported in the media lately. ABCON said the Central Bank of Nigeria (CBN) must urgently consult with licensed BDC operators to resolve the issues that trailed the regulator’s foreign exchange (forex) suspensionpolicy. This portrays ABCON said “if Read More
Importers of goods and services and other businessmen who depend on foreign exchange for their transactions have warned that prices of goods and services may hit the roof as the fortune of Naira worsens against the U.S Dollar and other international currencies. The exchange rate at the parallel market depreciated again to another all-time low on Wednesday Morning at N557/$1 Read More
The Central Bank of Nigeria (CBN) recently stopped the sale of foreign exchange to Bureaux De Change (BDC) operators over accusation of illicit financial behaviour. However, analysts have stressed the need for the apex bank to allow the BDCs receive diaspora remittances through the institution of a framework that allows those with automated operations access the estimated $34 billion into Read More
Naira extended its decline on Tuesday as it hits N550 against the United States Dollar at the parallel market, popularly called the black market, representing an all-time record low against the greenback. Against the British Pound and the Euro common currency, the Naira slid to N750 and N637, respectively. The inability to service the economy with enough forex coupled with Read More
The Central Bank of Nigeria (CBN) has disassociated itself from fake circular with CBN logo circulating in Social media purportedly that apex bank planned to convert domiciliary account holding to naira. In a statement signed by Director, Corporate Communication, CBN, Osita Nwanisobi condemns every rumour on domiciliary açcount. The statement which read in parts said “The attention of the CBN Read More
The Central Bank of Nigeria (CBN) says it’s investigating the foreign-exchange transactions of lenders operating in the country. Following “recent occurrences in the market”, the Central Bank of Nigeria “would like to remind banks to desist from all and any forms of foreign exchange (forex) malpractices”, the regulator said in a statement on Friday. Any lenders “found culpable with ongoing Read More
The Minister of State for Budget and National Planning, Prince Clem Agba, has eulogised the Association of Radiologists in Nigeria (ARIN) over the protective role it is playing in the health sector. Speaking Thursday in Abuja during the 58th annual general meeting of Association of Radiologist in West Africa (ARAWA), Agba said the association was able to put its best Read More