Continuous swimming of Naira against dollar. * Parallel market traders are now selling at N352 – USD1. * A decline in cement company shares has affected the naira value by almost 2 percent – President Buhari continues to maintain that he will not devalue the currency. The Nigerian naira has continued its unprecedented freefall in value against the US Dollar. Our national currency is now valued at N352 to USD1 on the parallel market, falling in value from N347 to the dollar yesterday. While some market operators did sell at N352 – USD1 yesterday, the market rate appears to have been in flux between N347 – N352. Our currency was trading within a range of 352 and 360 a dollar on the parallel market on Wednesday, February 17, down to a new record low from a range 347 to 352 on Tuesday due to continuous dollar shortages amid control by the central bank. As of today, the naira fell almost two percent, it was hit by a major decline in cement companies’ shares, including Dangote Cement, which accounts for the third of local bourse capitalisation. The local bourse index dropped 1.81 percent to 24,070 points at 1221 GMT as investors took profits from initial gains on the stocks. An anonymous stock broker said:“Due to the quick decline of the naira’s value, some offshore investors are booking profit and selling down their holdings.” Dangote cement shares fell 4.11 percent, Ashaka cement was down 4 percent while Cement Company of Northern Nigeria dropped 8.89 percent to drag the index down. The stock index, which has the second-biggest weighting after Kuwait on the MSCI frontier market index, has declined by around 14.41 percent since January According to Reuters, concerns over the naira’s depreciation and the unwillingness to adjust its exchange rate is a great factor contributing to the decline. Foreign exchange dealers have said that the rising pressure on the Naira is caused by high demand for the dollar by importers and speculators. The Central Bank of Nigeria remains doggedly determined to maintain its policy of pegging the Naira to N197 – USD1. Market analysts and CEO of Economic Associates Dr. Ayo Teriba, said the Nigerian economy should not have been allowed to deteriorate to its current point.
20 Feb 2016
Depreciation of Naira
Continuous swimming of Naira against dollar. * Parallel market traders are now selling at N352 – USD1. * A decline in cement company shares has affected the naira value by almost 2 percent – President Buhari continues to maintain that he will not devalue the currency. The Nigerian naira has continued its unprecedented freefall in value against the US Dollar. Our national currency is now valued at N352 to USD1 on the parallel market, falling in value from N347 to the dollar yesterday. While some market operators did sell at N352 – USD1 yesterday, the market rate appears to have been in flux between N347 – N352. Our currency was trading within a range of 352 and 360 a dollar on the parallel market on Wednesday, February 17, down to a new record low from a range 347 to 352 on Tuesday due to continuous dollar shortages amid control by the central bank. As of today, the naira fell almost two percent, it was hit by a major decline in cement companies’ shares, including Dangote Cement, which accounts for the third of local bourse capitalisation. The local bourse index dropped 1.81 percent to 24,070 points at 1221 GMT as investors took profits from initial gains on the stocks. An anonymous stock broker said:“Due to the quick decline of the naira’s value, some offshore investors are booking profit and selling down their holdings.” Dangote cement shares fell 4.11 percent, Ashaka cement was down 4 percent while Cement Company of Northern Nigeria dropped 8.89 percent to drag the index down. The stock index, which has the second-biggest weighting after Kuwait on the MSCI frontier market index, has declined by around 14.41 percent since January According to Reuters, concerns over the naira’s depreciation and the unwillingness to adjust its exchange rate is a great factor contributing to the decline. Foreign exchange dealers have said that the rising pressure on the Naira is caused by high demand for the dollar by importers and speculators. The Central Bank of Nigeria remains doggedly determined to maintain its policy of pegging the Naira to N197 – USD1. Market analysts and CEO of Economic Associates Dr. Ayo Teriba, said the Nigerian economy should not have been allowed to deteriorate to its current point.
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