Economy

MPC: FG fights inflation as CBN mops up N5trn

Published

9 months ago

March 4, 2024

Efforts by the Federal Government to curb the rising inflation will lead to N5 trillion cash mop up from the banking industry as the Central Bank of Nigeria, CBN implements the hike in banks’ Cash Reserve Ratio, CRR to 45 per cent.

The CRR which represents banks’ cash reserves for purposes of meeting cash obligations on demand was moved from 32.5 percent to 45 percent in apparent bid to curtail inflation.

Meanwhile, Financial Vanguard learnt that the apex bank is now working with some foreign portfolio investors, FPIs, to address concerns over recent reforms introduced in the foreign exchange market as well as the 400 basis points hike in the Monetary Policy Rate, MPR.

This is one of the outcomes of a virtual meeting, tagged Foreign Portfolio Investors Call, organised in collaboration with NGX Group, which was addressed by the CBN Governor, Mr. Olayemi Cardoso, Deputy Governor, Economic Policy, Mohammad Abdullahi, and moderated by the Group Managing Director/ CEO of NGX Group, Mr. Temi Popoola.

While speaking at the meeting with FPIs in response to inquiries about the impact of the hike on banking system liquidity, CBN Deputy Governor Abdullahi said that the banking system has a shortfall of N5 trillion to meet the 45 per cent CRR.

He, however, said that the apex bank will not debit the banks N5 trillion at once adding that the apex bank will implement the new CRR in a way that will not be disruptive to the industry. He disclosed prior the MPC decision, the effective CRR for the industry was close to 40 per cent.

He added some banks already have surpassed the 45 per cent CRR and they would be refunded the excess while banks with shortfall will have build up their cash reserves. Excess liquidity The estimated N5.0trillion which represented the outstanding system liquidity in excess of the initial CRR range is expected to impact the liquidity of many banks adversely.

Financial Vanguard learnt the decision to tighten came against the backdrop of deanchored inflationary trend which rose to 29.9 percent yearon- year, the highest since return to democracy in 1999. But financial analysts project the inflation rate would remain elevated in the near-term amid persisting exchange rate pressure, rising energy cost, and sustained fiscal imbalances.

In defending the huge jump in MPR and CRR, the CBN Governor, Yemi Cardoso, highlighted the disruptive impact of deficit financing to the Federal Government by Ways & Means, and also the direct intervention of the apex bank in the real sector which is estimated in excess of ¦ 10.0 trillion.

He also noted the structural inefficiencies within the foreign exchange market, and the need to collaborate strongly with fiscal authorities to effectively manage non-money factors. Analysts’ recommendations Commenting on this development, analysts at Afrinvest West Africa, a Lagos based investment house, said: “We suggest that in addressing inefficiencies, the apex bank prioritises the use of policy to minimise distortions and should remain focused on improving supply rather than countering the symptoms of illiquidity.

“In assessing impact on markets, we anticipate an immediate and strong bearish repricing of fixed-income yields especially on short-dated bills. “Furthermore, expectations of higher interest environment over the near-term coupled with liquidity squeeze amid costlier Standing Lending Facility (SLF) access should strengthen bearish sway”.

Free entry, exit for FPIs Meanwhile, Cardoso assured the FPIs of free entry and exit from the forex market. He added that the focus of the apex bank is to ensure stability of the exchange rate and ensure reasonable price discovery.

He also reiterated commitment of the CBN to achieving price stability adding that the MPC members are unanimous on the need to tame rising inflation and the 400 basis points hike in MPR is a strong signal to this effect. Cardoso assured the FPIs on policy consistency adding that the various measures introduced by the CBN in the forex market were product of extensive debate and strong conviction that is the right direction to go.

Higher interest rates in TBs Speaking further at the meeting, Abdullahi assured the FPIs the CBN will from today review upward interest rate on Treasury bills, TBs, in tandem with the hike in MPR. He further disclosed that from today, the CBN will increase frequency and size of Open Market Operations, TBs, to expedite liquidity mop up and provide instruments for FPIs to invest.

Economy

SEE Black Market Dollar To Naira Exchange Rate Today 11 December 2024

Published

6 hours ago

December 11, 2024

Naijablitznews

Black Market Dollar To Naira Exchange Rate Today 11 December 2024 Can Be Accessed Below.

The official naira black market exchange rate in Nigeria today including the Black Market rates, Bureau De Change (BDC), and CBN rates. Please note that the exchange rate is subject to hourly fluctuations influenced by the supply and demand of dollars in the market.

As of now, you can purchase 1 dollar at a certain rate now, however, it’s important to remember that the rate can shift (either upwards or downwards) within hours.

What’s the dollar to naira black market today 11 December 2024?
The local currency (abokiFx) opened at ₦1,665.00 per $1 at the parallel market otherwise known as the black market, today, Wednesday, 11 December 2024, in Lagos Nigeria, after it closed at ₦1,650.00 per $1 on Tuesday, 10 December 2024.

Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Buying Rate ₦1,705
Selling Rate ₦1,715

Please note that Nigeria’s black market dollar-to-naira exchange rate is typically higher than the official exchange rate because the Federal Government does not regulate it. The rates you buy or sell forex may differ from what is captured in this article because prices vary.

What’s the dollar to naira CBN exchange rate today?

1 USD = 1577.31 NGN
1 Dollars = 1577.31 Nigerian Naira
The USDNGN rate as of 11 Dec 2024

Economy

Naira Rebounds Against Dollar 24 Hours After Decline

Published

12 hours ago

December 11, 2024

Kayode Sanni-Arewa

The Naira has rebounded and gained value against the US dollar in the official foreign exchange market, just 24 hours after experiencing a depreciation.

According to the Central Bank of Nigeria’s exchange rate data for Tuesday, the Naira strengthened to N1,525 per dollar, up from N1,538.50 per dollar traded on Monday. This represents a gain of N13.5 against the dollar, following the previous day’s rate of N1,538.50.

In contrast, the parallel (black) market showed no similar improvement, with the Naira closing at N1,665 per dollar on Tuesday, up from N1,630 per dollar on Monday. This indicates a continued weakness in the unofficial market, where the Naira has struggled to match the official rate.

The Naira’s depreciation on Monday marked its first decline in the official FX market since the Central Bank of Nigeria (CBN) launched the Electronic Foreign Exchange Matching System (EFEMS) to ensure more transparent foreign exchange transactions. The decline raised concerns, but the recent recovery has sparked renewed hope.

Economists are optimistic that if the Naira can maintain its recent gains against the dollar in the official market, it could have a positive impact on the cost of imported goods, potentially easing inflationary pressures. However, concerns remain about the continued disparity between the official and parallel market rates, which could affect broader economic stability.

Economy

OPEC appoints Nigeria’s Adeyemi-Bero board of governors’ chairman

Published

12 hours ago

December 11, 2024

Kayode Sanni-Arewa

Nigeria has reaffirmed its leadership in the global energy sector with the appointment of Mr Ademola Adeyemi-Bero, Nigeria’s Governor for the Organisation of the Petroleum Exporting Countries, as Chairman of the Board of Governors for 2025.

A statement published on OPEC’s website noted that his appointment was confirmed at the 189th meeting of the OPEC Conference on Tuesday.

The statement partly read, “The conference appointed Mr Ademola Adeyemi-Bero, Governor of the Federal Republic of Nigeria for OPEC, as Chairman of the Board of Governors for the year 2025, and Eng. Adeeb Al-Aama, Governor of the Kingdom of Saudi Arabia for OPEC, as Alternate Chairman for the same period.”

Before he was appointed the Chairman of the OPEC Board of Governors, Adeyemi-Bero was confirmed as Nigeria’s OPEC Governor for the year 2025.

This role highlights Nigeria’s influence within the OPEC and underscores the nation’s commitment to shaping global energy policies.

Congratulating Adeyemi-Bero in a statement by his Special Assistant on Media and Communication, Nneamaka Okafor, on Tuesday, the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, hailed Adeyemi-Bero’s elevation as a testament to the country’s active contributions to the global oil industry.

The statement partly read, “He emphasised that this appointment provides Nigeria with a vital platform to advocate for balanced energy policies that benefit oil producers, consumers, and the global economy.

“The Honourable Minister also expressed profound gratitude to Ambassador Gabriel Aduda, the outgoing Nigerian OPEC Governor, for his exemplary service. He acknowledged Ambassador Aduda’s instrumental role in advancing Nigeria’s interests within OPEC and ensuring the country’s influential presence in global energy discussions.”

The OPEC Conference brought together representatives from member countries to address significant issues, including reports from the Secretary-General and the Economic Commission Board, and to deliberate on critical internal matters.

The conference also extended the tenure of Haitham Al Ghais as OPEC Secretary General for another three years, effective August 1, 2025.

Member nations commended his exceptional leadership and the Secretariat’s unwavering commitment to the organisation’s objectives.