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Naira depreciation: We’re waiting for CBN intervention—Bureau de change operators

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Naira’s woes continue for the second week as legitimate operators of Bureau De Change, BDC, await the Central Bank of Nigeria’s intervention.

FMDQ data showed that the naira dipped to N1520.40 per dollar on Tuesday from N1478.11.

This represents N42.29 depreciation against the dollar in the official market compared to N1478.11 traded on Monday.

Similarly, in the parallel market section, the naira dropped to N1520 per dollar on Tuesday, compared to N1500 the previous day.

The combined data showed that the margin between official and parallel foreign exchange markets stood at N0.40 on Tuesday.

Speaking about the development, Mistila Dayyabu, a BDC operator at Wuse Zone 4, urged the Central Bank to resume its supply of FX to the retail end of the market as a solution to the naira fluctuations.

“The naira depreciated further to N1,520 per dollar from N1,500 on Monday. We are eagerly waiting for CBN to release additional FX intervention into the retail end of the market,” he said.

From February to April 8, 2024, the apex bank distributed FX three times to BDCs.

However, the naira returned to depreciation in mid-April. During that period, it dropped by 28 per cent against the dollar.

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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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