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Econony

Dollar Hits N1,600 At Parallel Market

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The foreign exchange crisis worsened on Thursday as the local currency further depreciated, exchanging at N1,600 to a dollar at the parallel market, findings by Daily Trust have shown.

This was coming a few days after the local currency hit an all-time low at the official market, crossing N1,500 to one dollar.

The naira has come under a very severe attack in recent times, defying several interventions by the Central Bank of Nigeria (CBN) thereby worsening the cost of living crisis and inflation in the country.

Our correspondent reports that the naira has depreciated by over 50 per cent in the last five months.

Recall that the dollar first hit N1,000 in the parallel market in September 2023. It oscillated within that rate until the New Year when it started experiencing a free fall.

The depreciation of Nigeria’s currency is despite the federal government receiving a $2.25bn foreign exchange support from the AfreximBank as well as the offset of part of the unsettled forex obligations.

The CBN had also initiated a series of measures in recent times in a bid to stop the free fall of naira.

But the currency appears to be defying the various interventions as it depreciated further on Thursday at the parallel market amidst the decline in forex turnover.

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Econony

International Breweries announces increase in products prices

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International Breweries announces products price hike International Breweries Plc said it has increased prices of its various product offerings in Nigeria. The brewer said in a statement that reviewing prices in its portfolio has become necessary due to current market realities, and was done to serve its customers better.

The new price review affects products such as Eagle Lager, Eagle Extra Stout, Trophy Stout, Beta Malt, and Grand Malt.

Head of Sales of the company, Olaleye Abimbola, disclosed that it is confident that the decision to review the prices benefits all its partners.

Abimbola however called on the company’s partners to honour the old pricing strategy it had in the previous months until the new changes were announced and implemented.

This is the second time the company will increase the prices of its products in one year. International Breweries disclosed a forex-related loss of N162.2 billion in its first quarter report.

Major brewers in Nigeria have been hit by an economic crisis due to inflation, foreign exchange volatility, and rising production costs, which has led to price hikes across the country.

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Econony

Naira appreciates to N1,339.33/$1 on official market, best in 2 months

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The exchange rate between the Naira and the Dollar at the official window saw a significant appreciation of 10.71% on Monday, closing the day at N1,339.33/$1. 

This appreciation marks the highest closing rate since April 26, when the exchange rate was N1,339.23/$1, based on data from FMDQ. 

On Friday, May 24, 2024, the exchange rate was N1,482.81/$1, with a minor increase of 0.19%. The FX turnover on this day was significantly higher at $556.25 million, which represented a dramatic increase of 231.99%.

In contrast, on May 27, 2024, the Naira appreciated notably by 10.71%, bringing the exchange rate down to N1,339.33/$1. However, the FX turnover decreased sharply by 67.50%, amounting to $180.8 million. 

The substantial drop in FX turnover suggests a lower demand for dollars, which is a plausible factor contributing to the appreciation of the Naira. 

When fewer dollars are being bought, the demand decreases, leading to a stronger Naira against the Dollar.  

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Econony

Now investors are mocking us –Obasanjo Blasts Tinubu Over Nigeria’s Economy

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By Kayode Sanni-Arewa.

 

Former President Olusegun Obasanjo says President Bola Tinubu’s policies on fuel subsidy removal and exchange rates have adversely affected the Nigerian economy.

Obasanjo spoke via a statement issued by his media aide, Kehinde Akinyemi, on Sunday to assess the performance of the current government in the past one year.

He said the effects of the policies which he said were “wrongly implemented are pushing foreign investors away from Nigeria”.

He argued that “the present administration has not found the right way to handle the economy to engender confidence and trust for investors to start trooping in”.

Obasanjo continued: “Today, the government has taken three decisions, two of which are necessary but wrongly implemented and have led to the impoverization of the economy and of Nigerians. These are removal of subsidy, closing the gap between the black market and official rates of exchange and the third is dealing with a military coup in Niger Republic.

“The way forward is production and productivity which belief and trust in government leadership will engender. No shortcut to economic progress but hard work and sweat.

“Economy does not obey orders, not even military orders. I know that. If we get it right, in two years, we will begin to see the light beyond the tunnel. It requires a change of characteristics, attributes and attitude by the leadership at all levels to gain the confidence and trust of investors who have alternatives.

“Total Energy has gone to invest 6 billion dollars in Angola instead of Nigeria. If the truth must be stated, the present Administration has not found the right way to handle the economy to engender confidence and trust for investors to start trooping in.

“They know us more than we know ourselves. And now they are laughing at us, not taking us seriously. We have to present ourselves in such a way that we will be taken seriously. If the existing investors are disinvesting and going out of our country, how do we persuade new investors to rush in. We can be serious if we choose to be but we need to change from transactional leadership in government to transformational and genuine servant leadership.

“With change by us, the investors will give us the benefit of doubt, and security being taken care of on a sustainable long-term basis, they will start to test the water. With the right economic policies, attributes of integrity and honesty of purpose, all should be well with all hands on deck and the government becoming a catalyst for development, growth and progress.”

Obasanjo added that “tinkering with the exchange rate is not the answer” to the economic problems.

He said, “The answer is consistency and continuity in policy to ensure stability and predictability. That way, we will be sure of incentivizing domestic and foreign investment. There must be honesty and transparency in government dealings and contracts and not lying with deception about these issues. When the government is seen as pursuing the right policy, the private sector will go for production and productivity.

“With change by us, the investors will give us the benefit of doubt, and security being taken care of on a sustainable long-term basis, they will start to test the water. With the right economic policies, attributes of integrity and honesty of purpose, all should be well with all hands on deck and the government becoming a catalyst for development, growth and progress.

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