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Naira recovers on back of rising foreign reserves

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By Kayode Sanni-Arewa

The naira rallied to a recovery at the weekend on the back of sustained increase in the country’s foreign exchange (forex) reserves.
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The naira appreciated by 1.0 per cent to N1, 482.81 per dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM).

This came as the nation’s forex reserves rose by additional $73.05 million to $32.74 billion. It was the fifth consecutive accretion in the continuing buildup of the reserves.

Penultimate week, the reserves had added $195.01 million. It had grown by $89.76 million, $132.68 million and $10.76 million in recent weeks.

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At the forwards market, naira contracts closed on the upside at the weekend with the one-year contract appreciating by 1.1 per cent to $1,504.10 per dollar. The three-month contract recovered by 1.4 per cent to N1,546.65 per dollar while the six-month contract appreciated by 0.6 per cent to N1,621.89 per dollar. However, the one-year contract slipped by 0.1 per cent to N1,769.62 per dollar.

Finance and economy experts were unanimous that the buildup in external reserves was a good indication for the country’s currency management and macroeconomic stability.

Analysts expected that changes in forex management rules, steady improvement in crude oil production and upbeat in global oil price could help the country mitigate its volatile forex situation.

President, Association of Capital Market Academics in Nigeria, Prof Uche Uwaleke, said any increase places the CBN in a stronger position to meet forex obligations as well as intervene in the forex market.

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“If this development is sustained, we are likely to witness an appreciation of the naira in the forex market and more stability in the exchange rate following improved liquidity. This is one positive development capable of keeping away destructive speculators from the forex market,” Uwaleke said.

Uwaleke however said Nigeria needs to curb excessive import dependence to support its forex recovery.

“It goes without saying that export-based diversification remains the oly sustainable solution to the present forex crisis,” Uwaleke said.

According to him, to curb the demand pressure, government should compel a change in consumption behaviour by enacting a ‘Buy Nigeria law’ akin to the ‘Buy America Act’ of 1933 and recently the ‘Build America, Buy America Act’ of 2021.

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“Also, Nigeria’s import data support revisiting and scaling up the CBN’s currency swap deal with the Peoples Bank of China. Given that the bulk of Nigeria’s imports are from China, it stands to reason, therefore, to explore ways of bypassing the dollars and settling these transactions in the Yuan. This was the idea behind the currency swap with China which was largely inadequate in size. In order to increase the stock of Yuan in our external reserves, Nigeria can issue panda bonds, which are bonds denominated in the Chinese Yuan and are considered cheaper than Eurobonds,” Uwaleke said.

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Reuben Muoka bows out from NCC as Public Affairs Director

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After a luminous epoch, characterised by a meritorious service, Reuben Mouka, a veteran ICT journalist and public relations professional, has retired as Director of Public Affairs at the Nigerian Communications Commission ( NCC).

Muoka joined the Nigerian Communications Commission, NCC, from the Vanguard Newspaper where he was the HI-TECH Editor, some 18 years ago.

He was promoted to the position of the Commission’s Director of Public Affairs (DPA) on Monday, June 20, 2022.

He succeeded Dr Ikechulkwu Adinde, who redeployed in the special duty unit of the Commission.

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Muoka had worked in that unut as a principal officer for several years under Engineer Ernest Ndukwe and the late Dr. Eugene Juwah.

He was sent to the special duties and economic policy and analysis departments at some point during the first term of Professor Umar Danbatta as EVC.

He was head of media and public relations from 2009 until 2015, when Danbatta resumed as EVC.

At Vanguard, Muoka worked with Okoh Aihe, who recently retired from the NCC, to run the paper’s Hi-Tech pages and reported ICT for several years.

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He left Vanguard to work at MTS First Mobile, a pioneer company in mobile communication in Nigeria, as Corporate Affairs Manager.

Muoka has first and second degrees in Mass Communication.

He was once chairman of the League of Communications Correspondents, a beat association created in 1988 to help ICT journalists become professional ICT reporters.

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Again China increases tariffs to 125% as trade war with US continues

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On Friday, China raised tariffs on goods imported from the United States to 125 percent, responding directly to President Donald Trump’s move to increase levies on Chinese products to 145 percent.

This escalation has intensified the ongoing trade conflict, which poses a serious risk to global supply chains.

The tariff hike followed continued pressure from the U.S. government on China, which remains the second-largest economy in the world and a major supplier of goods to the U.S. While similar duties on many other nations have been suspended, China was specifically targeted for additional increases.

“The US imposition of abnormally high tariffs on China seriously violates international and economic trade rules, basic economic laws and common sense and is completely unilateral bullying and coercion,” China’s Finance Ministry said in a statement.

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The U.S. had previously announced that the total tariffs placed on Chinese imports under the Trump administration have now reached 145 percent.

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Sad! Explosion rocks Lagos

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An explosion caused confusion and fear on Friday evening in the Ikeja Under Bridge area of Lagos State after a loud blast came from a building.

The incident happened around 6:30 p.m., drawing attention from people in the neighbourhood who quickly rushed out in fear.

The blast was linked to a solar inverter that suddenly went off inside the building, causing a loud noise that shook nearby surroundings.

Many people in the area ran for safety, and traffic became heavy as vehicles slowed down due to the commotion.

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“The explosion was caused by an inverter that blew up. The Lagos Fire and Rescue Service is already on the scene. There’s heavy traffic in the area, and people were seen running in panic,” an eyewitness told Vanguard.

Emergency responders from the Lagos State Fire and Rescue Service quickly arrived at the scene to tackle the situation.

Firefighters worked to bring the fire under control and continued their efforts late into the evening.

As of 8:30 p.m., the fire was still being battled.

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Authorities at the scene assured residents that efforts were ongoing to fully manage the situation and there was no need to panic.

“There is no cause for alarm. The situation is under control,” Director of the Lagos State Fire and Rescue Service, Mrs. Margaret Adeseye said.

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