Oil prices are falling, elections are apporaching, Naira is nose diving at a time CBN is actually spending money to keep the naira at a normal level. It seems to me that the CBN is very good at pouring water into a basket and expecting to fill a tank. Or maybe they just want to be seen doing something. Report:

Nigeria Central Bank Vows to Defend Naira Near Record Low

Nigeria pledged to keep supporting its currency as the naira headed for a record low amid lower oil prices and the end of U.S. monetary stimulus that bolstered emerging-market assets.

“We will continue to defend the naira,” Sarah Alade, a deputy governor at the Central Bank of Nigeria, said by phone today from Abuja, the capital. “Yesterday, we saw the naira at a level we were not comfortable with. We increased dollar supply in the market and it calmed.”

Since mid-September, the central bank has used the reserves of Africa’s top oil producer and biggest economy to sell dollars outside of regular auctions held Mondays and Wednesdays, according to Standard Chartered Plc. (STAN) It will keep using the auctions and direct dollar sales to banks to preserve the value of the currency, Alade said. Her comments failed to stem the naira’s decline, with the currency set for its biggest one-day drop against the dollar since Sept. 25.

The naira weakened 0.9 percent this month as Brent crude fell to the lowest level in more than four years last week. [b]Further losses would force Nigeria to choose between raising interest rates, eroding reserves or, eventually, devaluing the currency,[/b]according to Exotix Ltd., a London-based investment bank. The Federal Reserve is ending a program this month of asset-buying that drove investors to buy stocks, bonds and currencies in developing nations.

Dollar Demand

The naira declined 0.4 percent to 165.75 against the dollar as of 12 p.m in Lagos. A close at this level will be lowest on record. The currency yesterday weakened as much as 0.4 percent to 166.07 before rebounding. At auctions, the central bank offers the currency at 155 per dollar, plus or minus 3 percent.

“We expect that investors will demand more dollars,” Alade said. “Our foreign-exchange reserves are still robust.”

Nigeria’s reserves were $39.2 billion as of Oct. 21 from $43.6 billion at the end of last year.

To contact the reporters on this story: Paul Wallace in London at pwallace25@bloomberg.net; Emele Onu in Lagos at eonu1@bloomberg.net

To contact the editors responsible for this story: Vernon Wessels at vwessels@bloomberg.net Emily Bowers
Source: http://www.bloomberg.com/news/2014-10-23/nigeria-central-bank-vows-to-defend-naira-near-record-low.html

I predicted the naira to fall to an all time low against major currencies by December/January. Goodluck will erode the reserves to fund elections. Oil Prices will fall, US stimuli will weaken.
If you want to send money to Nigeria, save your money till january ending or February and you are most likely going to get a 2% increment.

It is time Africans ignore these blood sucking foreign usurpers that determines the masses faith from the comforts of their offices and focus on building their economies which ever way they can through productivities and innovations that will benefit the masses practically,not just for the sake of GDP.

Bleep dollar,it is not an essential commodity for africans.

redsun:
It is time Africans ignore these blood sucking foreign usurpers that determines the masses faith from the comforts of their offices and focus on building their economies which ever way they can through productivities and innovations that will benefit the masses practically,not just for the sake of GDP.

Bleep dollar,it is not an essential commodity for africans.

I see you hate the truth. Our economy is moving towards a crash and the indicators are to be dismissed?

HMMM

olapluto:

I see you hate the truth. Our economy is moving towards a crash and the indicators are to be dismissed?

If you are really intuitive you will ask yourself why an economy that is just about to take off crash?

Laying ordinary street pavements in Nigeria is worth billions of dollars with thousands of jobs to go with it,yet we are talking of crash. And it is just a tip of the iceberg of things that waiting to be generated.

Economy my asss.

Splashme:
So many prophets of doom in the APC.
Always concocting negative news about their country
and expecting everyone to believe them.

Is it today we started hearing Nigeria's economy crashing?
The APC false prophecies will always fail . . . . Amen!

Bloomberg joins CNN, BBC, SA govt, etc in being card carrying APC members.

olapluto:

Bloomberg joins CNN, BBC, SA govt, etc in being card carrying APC members.

What exactly are you celebrating about a falling oil price? Is this the first time oil price has dropped in the last couple of years? CBN has always defended the naira, so does other oil dependent economies. Naira did not crash, despite IBB SAP experiment, it did not crash when militancy grounded our oil exports, Nigeria and Nigerians are creative people and will always manage their issue.

For bloomberg to single out our country among other oil exporting nations and talk about the effect of oil price crash is a testament that Nigeria is doing something right and is being watched closely.

Naija which way?. Dollar kept on rising against Naira on daily basis

FrankC3:


What exactly are you celebrating about a falling oil price? Is this the first time oil price has dropped in the last 20 years? CBN has always defended the naira, so does other oil dependent economy. Naira did not crash, despite IBB SAP experiment, it did not crash when militancy grounded our oil exports, Nigeria and Nigerians are creative people and will always manage their issue.

For bloomberg to single out our country among other oil exporting nations and talk about the effect of oil price crash is a testament that Nigeria is doing something right and is being watched closely.

Oh dear! do you even know what Bloomberg is or does? This is perhaps the first news on Nigeria for a long time. I am on Bloomberg almost daily and it is easy to see countries who are advancing on daily basis.
Apart from the rebasing (which is like changing goal post), nothing worthy has come out of Nigerian economy except bad news.
As you can see in the report, falling oil prices is just one of the reasons for the falling Naira.
Nigeria is not doing anything right at this moment. Forget the bullcrap your government is feeding you. The major indicators for an economic growth are absent in Nigeria.

olapluto:

Oh dear! do you even know what Bloomberg is or does? This is perhaps the first news on Nigeria for a long time. I am on Bloomberg almost daily and it is easy to see countries who are advancing on daily basis.
Apart from the rebasing (which is like changing goal post), nothing worthy has come out of Nigerian economy except bad news.
As you can see in the report, falling oil prices is just one of the reasons for the falling Naira.
Nigeria is not doing anything right at this moment. Forget the bullcrap your government is feeding you. The major indicators for an economic growth are absent in Nigeria.

Naira Rebounds From 7-Month Low on Nigerian Intervention
http://www.bloomberg.com/news/2014-10-22/naira-rebounds-from-7-month-low-on-nigerian-intervention.html

Ebola Fighters Enlist Texts in Bid to Curb Outbreak
http://www.bloomberg.com/news/2014-10-23/ebola-fighters-enlist-texts-in-bid-to-curb-outbreak.html ---This article talked about Nigeria's success.

You claim to visit Bloomberg daily. How come you never post any those articles where Nigeria was mentioned in positive light but quickly posted this one that was posted less that 3 hours ago.

Why do you hate your country that you celebrate bad news about her but downplay the good news or even pretend that they don't exist?

olapluto:

Oh dear! do you even know what Bloomberg is or does? This is perhaps the first news on Nigeria for a long time. I am on Bloomberg almost daily and it is easy to see countries who are advancing on daily basis.
Apart from the rebasing (which is like changing goal post), nothing worthy has come out of Nigerian economy except bad news.
As you can see in the report, falling oil prices is just one of the reasons for the falling Naira.
Nigeria is not doing anything right at this moment. Forget the bullcrap your government is feeding you. The major indicators for an economic growth are absent in Nigeria.

your stupidity stinks to high heaven. so simply because you spend your life time on bloomberg automatically means you know what they are saying or doing? mtchew.

Nigeria is not doing anuthing yet our food import has dropped drastically (even your APC power brokers has not denied that except you have a link to show me)

what is Nigeria surposed to be doing that she is ignoring or has stopped doing since this administration took over?

i want specific answers not rambling

aguiyi:


your stupidity stinks to high heaven. so simply because you spend your life time on bloomberg automatically means you know what they are saying or doing? mtchew.

Nigeria is not doing anuthing yet our food import has dropped drastically (even your APC power brokers has not denied that except you have a link to show me)

what is Nigeria surposed to be doing that she is ignoring or has stopped doing since this administration took over?

i want specific answers not rambling

You see,you're a prime example of the gullibility of Nigerians. IF food import drops, naira will rise! If economy improves, Naira will rise. If jobs are created, Naira will rise. The confidence in the naira will grow. Traders will want to invest in it. Our government will not need to buy Naira to save naira.
On your sheepish claim of food importation decrease, I advice you to put it to test. We have a cosmetic government that will say anything to be relevant, but the facts are not there to back it up.
Read this editorial as a start (written a year ago)
EDITORIAL

President Goodluck Jonathan, at the 7th Annual Banking and Finance Conference in Abuja, said that the country spent N630billion last year to import agricultural products.

The president spoke through his minister of state for finance, Dr. Yarima Lawal Ngama. Earlier in July, the minister for agriculture and rural develoment, Dr. Akinwunmi Adesina, had lamented how Nigeria fritters away a whopping N1.3trillion to import four food items yearly. This includes a monstrous N356bn, or roughly N1bn per day, on importing parboiled rice; a humongous N217bn on sugar and an unbelievable N97bn on fish. This is indefensibly scandalous for a country whose leaders claim to be "vigorously" pursuing an Agriculture Transformation Agenda (ATA) and where food items can be sourced locally. Clearly, some government officials must be benefiting from a racket in this bogus expenditure; otherwise we have no business importing food items like rice, wheat, fish, sorghum and tomatoes.

Nigeria has been a leading contender for the position of the country with the highest level of food insecurity in the world, according to the Food and Agriculture Organisation (FAO) since 2011. Nothing has been done to monitor the country's food import bill. Off the figures released by the Central Bank of Nigeria, wheat accounted for the highest amount with N165bn, while fish (N105bn), rice (N75bn) and sugar (N60bn) followed, in that order. The figures keep skyrocketing at an abysmally intolerable 11 per cent per annum. A serious government would have declared an emergency in the sector.

Food security has three basic dimensions: availability, access, and stability. While food availability is determined by the level of food supply composed of subsistence production and market supply stemming from domestic production, food stocks and food imports, access to food is the result of the ability to express food needs (beyond subsistence production) as effective demand, while experts see stability as variations and the risk of shortfalls in food production, supply and/or demand over time. Nigeria has no response mechanism to a situation where both food supply and demand meet and the requisite calories to meet the people's needs are available on a continuous and stable basis.

It is painful that each time the spin doctors reel out the Goodluck Jonathan administration's achievements, agriculture is rated high. The question is: at what cost? If most of the food we import can be grown locally with enough leftover for export, why have we not returned to the drawing board and reconnected to the immediate post-colonial era when, through good policies, planning and political will, the economy was driven by agriculture? Perhaps we need remedial programmes to address our over-reliance on crude oil.

President Jonathan and his economic management team are either inept or unpatriotic. Their task should be simply to revive agriculture that was the mainstay of the economy five decades ago, when we were the envy of most advanced economies. There is a groundswell of opinion that unemployment will be put to flight once we get serious about farming. It is the sure path to prosperity. We cannot afford to continue to wallow in self-pity over atrocious amounts spent on imported food items when we could be a giant in food export.

The only solution is to diversify the economy.

Let's wait for the experts.
But as an average ordinary,hardworking Nigerian,my assessment is the Nigerian economy is in abyss.I'm talking about "stomach infrastructure" now.
Count APC out of the bloomberg article.
The CBN woman corroborated the story btw.

Thanks Op for the post.Here in Nigeria,the Jonathan administration keeps spewing fantastic economic success stories,celebrated by his sycophants.
But the majority know the "largest" economy in Africa is actually failing.

APC AGAIN NW PASSING THROUGH BLOOMBERG, OIL PRICES HAVE BEEN FALLING SINCE AND THE NIGERIAN ECONOMY NEVER CRASH. NW THAT THE GOVERNMENT IS TRYING TO DIVERSE THE ECONOMY THE JANJAW..EEDS ARE DOING EVERYTHING POSSIBLE TO SABOTAGE IT AND SCORE POLITICAL POINT.

They believe and love Bloomberg, CNBC, CNN etal when they rank us the biggest economy in Africa, but hate them when they say that our Naira is losing value against major currencies..
Nigerians are arrogantly ignorant!! Prices of crude oil have dropped in the last couple of weeks.. Most of us don't read the news. It's been very difficult to source foreign currencies from our local banks which serve as CBN intermediaries. US $1 changes to N170 at inter bank rate, black market will cost more. About 2 wks, it went from N168 to N170.

adconline:
They believe and love Bloomberg, CNBC, CNN etal when they rank us the biggest economy in Africa, but hate them when they say that our Naira is losing value against major currencies..
[b]Nigerians are arrogantly ignorant!! [/b]Prices of crude oil have dropped in the last couple of weeks.. Most of us don't read the news. It's been very difficult to source foreign currencies from our local banks which serve as CBN intermediaries. US $1 changes to N170 at inter bank rate, black market will cost more. About 2 wks, it went from N168 to N170.

Not all Nigerians, but a sizeable chunk of those supporting the president. You can see them on this thread trying so hard to defend the government. We all know crude oil is our major source of income. This same crude oil has been increasing in price for last 4 years. We dey chop am dey clean mouth for 4 years. Now the doom is before us, our government is running from pillar to post. Worst time for oil prices to fall is during election period. PDP needs money, and they need it big. CBN also need a lot of money to regulate the naira.

olapluto:

You see,you're a prime example of the gullibility of Nigerians. IF food import drops, naira will rise! If economy improves, Naira will rise. If jobs are created, Naira will rise. The confidence in the naira will grow. Traders will want to invest in it. Our government will not need to buy Naira to save naira.
On your sheepish claim of food importation decrease, I advice you to put it to test. We have a cosmetic government that will say anything to be relevant, but the facts are not there to back it up.
Read this editorial as a start (written a year ago)
EDITORIAL

President Goodluck Jonathan, at the 7th Annual Banking and Finance Conference in Abuja, said that the country spent N630billion last year to import agricultural products.

The president spoke through his minister of state for finance, Dr. Yarima Lawal Ngama. Earlier in July, the minister for agriculture and rural develoment, Dr. Akinwunmi Adesina, had lamented how Nigeria fritters away a whopping N1.3trillion to import four food items yearly. This includes a monstrous N356bn, or roughly N1bn per day, on importing parboiled rice; a humongous N217bn on sugar and an unbelievable N97bn on fish. This is indefensibly scandalous for a country whose leaders claim to be "vigorously" pursuing an Agriculture Transformation Agenda (ATA) and where food items can be sourced locally. Clearly, some government officials must be benefiting from a racket in this bogus expenditure; otherwise we have no business importing food items like rice, wheat, fish, sorghum and tomatoes.

Nigeria has been a leading contender for the position of the country with the highest level of food insecurity in the world, according to the Food and Agriculture Organisation (FAO) since 2011. Nothing has been done to monitor the country's food import bill. Off the figures released by the Central Bank of Nigeria, wheat accounted for the highest amount with N165bn, while fish (N105bn), rice (N75bn) and sugar (N60bn) followed, in that order. The figures keep skyrocketing at an abysmally intolerable 11 per cent per annum. A serious government would have declared an emergency in the sector.

Food security has three basic dimensions: availability, access, and stability. While food availability is determined by the level of food supply composed of subsistence production and market supply stemming from domestic production, food stocks and food imports, access to food is the result of the ability to express food needs (beyond subsistence production) as effective demand, while experts see stability as variations and the risk of shortfalls in food production, supply and/or demand over time. Nigeria has no response mechanism to a situation where both food supply and demand meet and the requisite calories to meet the people's needs are available on a continuous and stable basis.

It is painful that each time the spin doctors reel out the Goodluck Jonathan administration's achievements, agriculture is rated high. The question is: at what cost? If most of the food we import can be grown locally with enough leftover for export, why have we not returned to the drawing board and reconnected to the immediate post-colonial era when, through good policies, planning and political will, the economy was driven by agriculture? Perhaps we need remedial programmes to address our over-reliance on crude oil.

President Jonathan and his economic management team are either inept or unpatriotic. Their task should be simply to revive agriculture that was the mainstay of the economy five decades ago, when we were the envy of most advanced economies. There is a groundswell of opinion that unemployment will be put to flight once we get serious about farming. It is the sure path to prosperity. We cannot afford to continue to wallow in self-pity over atrocious amounts spent on imported food items when we could be a giant in food export.

i really wonder what you are doing on Bloomberg if you don't know what multiplier effect is and what could cause a major multiplier effect in an economy.

Nigeria is dependent on oil not agricultural export hence the major thing that will cause a major rise in naira is a drop in petroleum product importation.

i really dont have time lecturing you but you need to visit the front page to see currencies that the naira is stronger than and tell me whether the standards in some of those countries are same with that of Nigeria


Note that the ghanian currency is stronger than the naira but the economy is dwindling.

the pound is stronger than the dollar yes but is the Uk economy also stronger than the American economy?

a strong currency is not a major indicator of a strong economy. Abi your economy dey stronger than that of Iran?

Just use our reserves for development, not defending the NAIRA. Let it float!!!