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Naira Watch: It’s Now N363/$1 by AbiolaFawole(m): 7:44am On Jun 07, 2017 |
The Naira, Tuesday, appreciated to N363 per dollar in
the parallel market due to a combination of weak
demand and increased dollar supply.
Vanguard survey revealed that the parallel market
exchange rate dropped to N363 per dollar from N371
per dollar on Monday, indicating N8 appreciation for the
Naira.
Confirming this development, President, Association of
Bureaux De Change Operators of Nigeria (ABCON),
Alhaji Aminu Gwadabe, said it was due to increased
confidence in the foreign exchange market due to
consistent dollar injection by the Central Bank of Nigeria
(CBN).
“Most of the huge demand for dollars and spike in the
rate were fuelled by speculation and hoarding. The
sustained dollar injection by CBN has eliminated these
types of demand, hence low level of demand and
appreciation of the Naira,” he said.
On Monday the CBN injected $190 million dollars into
the interbank market. This comprised $100 million for
wholesale interventions, $50 million for SMEs for forex
window, and $40 million for Business/Personal Travel
Allowances, tuition and medical fees, among others.
Also the Senate on Tuesday mandated its Committee
on Banking, Insurance and other Financial Institutions to
hold roundtable with Central Bank of Nigeria(CBN) and
other stakeholders over high interest rate.
It directed the committee to meet with experts in the
finance industry to find immediate and sustainable
solutions that would usher in a new interest rate regime
that supported enterprise development in the country.
The decision followed a motion by the Chairman,
Senate Committee on Banking, Insurance and other
Financial Institutions, Sen. Rafiu Ibrahim, at plenary.
Ibrahim said that it was disturbing that in spite of all
the negative economic indices in the country, banks
had continued to declare huge earnings and profits.
“The current regime of high interest rate continues to
place a major burden on business investments and
household consumption spending in Nigeria, thereby
negatively impacting on the survival of Nigerian
businesses.
“This is perpetuating the indicator which shows that
only about three per cent of Small and Medium
Enterprises (SMEs) starting up, have access to credits
from banks.
“This insignificant percentage ironically employs about
88 per cent of our workforce and therefore the
backbone of the economy.
“It is disturbing that lending rates to the private sector
has hovered between 28 per cent and 30 per cent
across board,’’ he said.
In his contribution, the Deputy Leader of the Senate,
Sen. Bala Na’Allah, said that there was an urgent need
to discuss with all relevant stakeholders on the way
forward.
According to him, it is worrisome that in spite of the
current economic situation, which has largely affected
Nigerians, the interest rate is high.
Na’Allah said “there is a dire need for a stakeholders’
roundtable to address increasing interest rates in
Nigeria.
“I wonder why the interest rates are outrageously high,
in spite of the fact that the country is yet to get out of
the recession.
`The banks are run by a powerful cartel. They do what
they like and jerk up interest rates.
“Over the years, we have seen the exchange rates go
up, but it is not the same in other economies of the
world.
“Nigeria has the most unpredictable economy in the
world and we have to be worried about this,’’ he said.
In his remarks, the President of the Senate, Dr Bukola
Saraki, gave credence to the claims by criticising what
he described as the twin evil of interest and exchange
rates.
He said that it was unreasonable for companies to
continue to lay off staff, while declaring huge profits
annually.
Saraki, however, assured that the Senate would step in
and ensure that the right thing was done.
He said “there has always been the twin evil of
exchange rate and interest rates.
“We cannot live in a country where companies are
folding up, yet organizations are declaring mega profits.
The committee should swing into action.”
He assured that the senate would not hesitate to see to
the implementation of the committee’s resolutions. http://fawoleblog..com/2017/06/naira-watch-its-now-n3631.html?m=1 |
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