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Nairaland Forum / Nairaland / General / Politics / Why Naira Will Continue To Decline - An Analysis (1076 Views)
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Why Naira Will Continue To Decline - An Analysis by lastkingsman: 12:29pm On Jan 28 |
The debt service ratio is one way of calculating a business's ability to repay its debt. It compares income to debt-related obligations. Bankers often calculate this ratio as part of their considerations of whether or not to approve a business loan. Take note of the bolded, will revisit that in a moment. You see, the debt management office told us in June, 2023 that this ratio is 73% https://www.thecable.ng/dmo-pegs-debt-service-to-revenue-ratio-at-73-5-says-its-unsustainable/amp KPMG predicted 100% before Dec 2023 https://www.thecable.ng/kpmg-nigeria-may-spend-over-100-of-its-revenue-on-debt-servicing-in-2023/amp Just taking a simple average, that figure is not less than 88% now. The implications is that we can no longer borrow and all our revenue is used to service debt. Naira is printed at a crazy rate to meet FG financial obligations and these monies are looted and used to buy the scarce dollars driving up the price higher. It's an infinite loop ➿ that will total destroy the value of naira. Our net reserve according to JP Morgan is 3.75bn USD. So we can't even defend the naira. Dangerous times ahead 9 Likes 2 Shares |
Re: Why Naira Will Continue To Decline - An Analysis by metaluterus(f): 12:31pm On Jan 28 |
What we have in our hand is the supply problem. If supply keeps getting worse, the problem of the FX will continue to the highest. Economists in the house, come and explain how this work 2 Likes |
Re: Why Naira Will Continue To Decline - An Analysis by Bigkoko: 12:37pm On Jan 28 |
Last year while working on a project for a client, I stumbled on a piece written by PwC, an advisory for African markets....the Nigerian situation is so terrible, that I could not hide. I drop it here anonymously..... On the forex situations, I encourage him to go get 20,00,000 NGN and buy USD, that within three months he will cash out Big time doing nothing! Smart guy, he did accordingly and just sold his last batch of USD, making a hefty RoI. You see, inflation is good for those with cash, and very bad for those without! Well, as usual those with corn in Their back pocket called me all sorts of names....well I'm glad the few corn in their pockets is gradually running out, then they will taste the power of bad leadership! Elections truly has consequences! lastkingsman: 1 Like |
Re: Why Naira Will Continue To Decline - An Analysis by RepoMan007: 12:43pm On Jan 28 |
metaluterus:you can't do that never. BDC is just a format. No sane person who knows Nigerian govt and how it is run will remit dollar or pounds to a CBN that will allocate it to corrupt officials to resell to their relatives looking to import goods at double the rate CBN is buying. You have to size people's dollar to do that. |
Re: Why Naira Will Continue To Decline - An Analysis by lastkingsman: 12:50pm On Jan 28 |
metaluterus: BDCs are not the problem. FX is simply dollar inflow and outflow. The equilibrium is the price. In Nigeria, the dollar outflow is so much and it's still rising. The four major components (Exports, FDI, FPI and Remittances from Diaspora)that facilitated inflow have been decimated. Only remittances are still holding the price from crash landing 5 Likes 1 Share |
Re: Why Naira Will Continue To Decline - An Analysis by Righthussle: 2:14pm On Jan 28 |
Ok |
Re: Why Naira Will Continue To Decline - An Analysis by tensazangetsu20(m): 2:24pm On Jan 28 |
You still dey do analysis. With Tulumbu as president, we can expect 5000 naira to a dollar by 2026. On your mandate we shall stand, on your mandate, on your mandate we shall stand. 2 Likes |
Re: Why Naira Will Continue To Decline - An Analysis by Melagros(m): 2:44pm On Jan 28 |
COMRADES, you don't need a soothsayer to tell you that, even birds of the air know that tinubu is incompetent |
Re: Why Naira Will Continue To Decline - An Analysis by lastkingsman: 3:11pm On Jan 28 |
tensazangetsu20: Chai. That's mean diesel/fuel (without subsidy) will be retailing around 4500N/L+ and to full Toyota Corolla tank will cost around 250,000+. Chai, it's finished and Tulumbu is looking every strong to go for second term starting 2027 - 2031 |
Re: Why Naira Will Continue To Decline - An Analysis by lonecatt(m): 3:19pm On Jan 28 |
All because we have two consecutive vegetables as president. |
Re: Why Naira Will Continue To Decline - An Analysis by tensazangetsu20(m): 3:42pm On Jan 28 |
lastkingsman: When we told them, they said we were crazy. I already knew that tibubu will be worst than buhari right from 2020. It's why I ensured I voted. If it was another person I wouldn't even mind to be honest. |
Re: Why Naira Will Continue To Decline - An Analysis by GerogeI(m): 4:11pm On Jan 28 |
lastkingsman: Leave all the gimmick metrics and use your head. It's simple, you exchange rate depends on your demand for other peoples currency vs other peoples demand for your currency. Which is directly related to you imports vs exports. For Nigeria, our imports is nearly twice our exports, which is not really bad. So we are relatively rich and I demand. But through incompetence, theft, and over centralization, the Naira is continously being devalued. And when I speak of incompetence, it's about the current CBN Governor and his Boss. Both are clueless, just like the previous administration. |
Re: Why Naira Will Continue To Decline - An Analysis by lastkingsman: 12:08pm On Feb 04 |
No end in sight, the price discovery continues! |
Re: Why Naira Will Continue To Decline - An Analysis by lastkingsman: 6:10pm On Feb 13 |
lastkingsman: $1 = 1520N (official)! |
Re: Why Naira Will Continue To Decline - An Analysis by lastkingsman: 3:50pm On Feb 19 |
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Re: Why Naira Will Continue To Decline - An Analysis by lionshare: 10:30am On Feb 20 |
Bigkoko:Naira depreciation is bad for everyone including those hedging by stockpiling USD as long as you live & spend in naira. |
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