ITbomb:
When you don't produce anything that another country would need, your currency falls

If what you are producing is wanted by another country, your currency will be strong

Problem is that we depend on oil as we cannot produce any other thing, so when we were producing and selling oil at high quantities, our currency was stable.
Now that most buyers of oil are looking elsewhere, we don't sell enough to balance what we are buying from other countries, so our Naira falls

I believe this is "layman" enough

Bros sorry permit me to say this I think corruption is the bane to the growth of our naira not the production abd or manufacturing. Ghana don't produce has much as we do but their currency is weighty than ours because the level of corruption is at a lowest minimal when compared to ours

Hismasterpiece:


so the reason for our currency devaluation is because we don't export anything besides oil? But what about UAE? Isn't it the money they make from oil that's the reason their country is the way it is?

he mention something like greediness .. when you sell 1billion dollar of crude and remit only half of that amount to country acct while the rest go into personal account, this will create few rich people and make the Nation to loss alot by the time the country has to pay wages for those who work for that a billion ....

even china is great today not because of few individual riches but what country has been able to generate from his citizen and able to use such to improve the well being of everyone not the few as we practice in Nigeria

Hismasterpiece:
Hello.

Recently i have been hearing about the dollar going up in value.

And this has brought about a hike in the prices of commodities in the market and has also brought about a hike in the cost of living of the average Nigerian.

So things are tough in the country now because of this dollar phenomenon

So i would like to know what determines the value of a country's currency and why the Nigerian Naira appears to constantly reducing in value while that of America keeps going higher and higher.

Anybody with meaningful information is welcome. Thanks.

Abokifx according to your CBN governor

cloud:
the only difference is that unlike Nigeria, UAE does not import refined fuel back to the country. Remember that this imported fuel is paid for in scarce dollars.

Thank you, even the oil people are shouting up and down we only export crude and buy back refined product.

Hismasterpiece:
Hello.

Recently i have been hearing about the dollar going up in value.

And this has brought about a hike in the prices of commodities in the market and has also brought about a hike in the cost of living of the average Nigerian.

So things are tough in the country now because of this dollar phenomenon

So i would like to know what determines the value of a country's currency and why the Nigerian Naira appears to constantly reducing in value while that of America keeps going higher and higher.

Anybody with meaningful information is welcome. Thanks.

The VALUE of a President's Brain can also be used to measure the value of that country's currency.
IF your PRESIDENT is an IDIOT, the value will definitely drop.
But if he's got a quality IQ, it will appreciate.

Op, here are the most important factors that determines the value of a country's currency. Any other thing are just offshoots of the factors listed below. I'll list them here and that's it. If you have any questions on how each of these affect the naira you can let me know so I'll elucidate.
1. Unemployment rate.
2. The country's apex Bank interest rate on lending
3. Balance of trade.
4. Level of manufacturing or industrial production in the country also called manufacturing index.
5. Political stability.
6. Inflation rate
7. Consumer confidence
8. A country's balance of payment and gearing

Hismasterpiece:
Hello.

Recently i have been hearing about the dollar going up in value.

And this has brought about a hike in the prices of commodities in the market and has also brought about a hike in the cost of living of the average Nigerian.

So things are tough in the country now because of this dollar phenomenon

So i would like to know what determines the value of a country's currency and why the Nigerian Naira appears to constantly reducing in value while that of America keeps going higher and higher.

Anybody with meaningful information is welcome. Thanks.

Demand and supply of the currency

If there is more demand for a particular currency, it's scarcity will make it expensive than the currency being used to exchange it for the other

Nigerian dependence on the dollar is largely influenced by speculation and people using it to store value

As for importation and exportation, that's another issue entirely and has a different effect on a currency but it's not as direct as demand and supply of a particular currency

smeag0l:
Op, here are the most important factors that determines the value of a country's currency. Any other thing are just offshoots of it. I'll list them here and that's it. If you have any questions on how each of these affect the naira you can let me know so I'll elucidate.
1. Unemployment rate.
2. The country's apex Bank interest rate on lending
3. Balance of trade.
4. Level of manufacturing or industrial production in the country also called manufacturing index.
5. Political stability.
6. Inflation rate
7. Consumer confidence
8. A country's balance of payment and gearing

Please what about the President's IQ?

There are some hidden factors involve that wouldn't be disclose to us.

Wetin AMERICA dey import self ?

The main issue to fix 99.9% of our problem is to fix power. When you fix power, all comments above will fall into the right place. We are resourceful in Nigeria. Shikena..

We export sufficient amount of oil to keep our economy stable. The problem is that, we spend all that on importing fuel and every other things.
If only we produce our fuel and not import. That's why I believe this is intentional. This has been the number 1 problem in this country economy yet the government are not doing anything to stop the import of fuel. Why can't this government construct working refineries, repair the bad ones.
Our government has access to funds more than Dangote. Why couldn't they do it. It's just disappointing.

VeeVeeMyLuv:
It is not that Dollar is going up

Instead it is your naira that is diving downwards.

@ topic

1. Fisical responsibility and accountability.
2. The level of greed & corruption.
3. Human rights law.
4. Foi.
5. Ease of doing business
6. Level of insecurity
7. Amount of export to import.

I think these points are sufficient

No sir

GDP: gross domestic products : we import more than we produce.
Most of our consumables are imported, shoes, fabrics, rice, agricultural produce we still import., Our export on agricultural produce is far lesser compared to importation.
What causes this cost of producing locally is high, no power supply, bad roads to farm areas, insecurity and unfavorable govt laws.

2. Demand for dollar to do your importation, law of demand comes in, govt need dollars to bring in fuel, biznes men need too and our politicians are changing the I'll gotten money , indollars kept idile in domiciliary acct.when demand is higher than supply the price goes up.
Untill we start producing locally it will continue to soar high and naira depreciate or govt push in more dollars into the forex market, the latter is dangerous because we be using naira to source for this dollar and our brothers in politics will just be stock piling it and we kill the naira finally.
,

Let me try to explain the best I can; like some rightly put up there, the value of your currency is directly affected by the amount of the international legal tender; say the dollar for instance, that you have in your foreign reserve. Now the CBN determines the value of your naira to dollar- you hear cbn devalues the naira every now and then. They do this so as to control how much dollar you can take in bid to control what is left in the reserve. If they set a naira to a dollar for instance, now imagine how much will be left in the reserve if every tom and dick comes with a naira to collect a dollar. How much will be left for dangote and otedola who wants to import one thing or the other into Nigeria. My bad , I meant to say how much will be left for you and I that wants to import one laptop or iphone because if they set a dollar to a naira, the likes of dangote and otedola will empty the reserve in maybe a month, and there will not be enough to go round. So you see the secret to having a strong local currency value against the dollar, is to export more so that will can get more dollars into our reserve and the central bank will bring the value of the naira up against the dollar; as we would have had enough to go round. Now don't get it twisted, even if we have more than enough in our foreign reserve, the central bank can still put the value of the naira down against the dollar, which could be done maybe due to one economic policy or the other- china is a typical example. The want to control how much dollar they release back to the world.

It is the level of local production in that country. When you have a thing locally you don't go out to buy. It is when you go out to buy that the next country makes something off you and in the process bites of the value of your local currency and use to strengthen his own currency.
Imagine that Nigerians suddenly starts producing 100 times more than we currently do. We will end up selling the excesses but CBN will not print more local currencies. Instead the value of local currency will strengthen by close to a factor of 100.

zolajpower:

Bros sorry permit me to say this I think corruption is the bane to the growth of our naira not the production abd or manufacturing. Ghana don't produce has much as we do but their currency is weighty than ours because the level of corruption is at a lowest minimal when compared to ours

we are ruled by people who believe in dominating rather than equality .... and most of what is generated in ghana atleast 90 percent goes into develop Ghana unlike our own whereby 70 percent goes into personal purse .... mind you these loot are not been reinvested into Nigeria most are starched in foreign account

imagine you have a farm that you never turn up to maintain or do replant or to apply fertilizer and so but you only show up when it time to havest, a time will come whereby you will have nothing to show for such farm

When the HC is appreciate to FC,when the dd for the HC is higher than the FC

Iliveforever:
I think scarcity. No enough foreign companies bringing dollar into the country. FG only depends on dangote and oil. Only God can intervene

And they are not even bothered to invest in human resources. Take Japan for instance, this guys built heavy machines for America which in turn bring plenty of $ into their country.
Human resource should be the number thing.

I would like to know too.

Hismasterpiece:


so doing business in Nigeria isn't easy? how do you mean?

how does insecurity affect the country's currency value

doesn't nigeria export oil among other things?

Insecurity leads to capital flight. It is extremely difficult to do business in Nigeria, for instance you provide your own Electricity and you also have multiple levels of taxes not to talk of useless youth development levy and other forms of extortion.

na their AbokiForex na. Every country has their AbokiFX.. Argue with Emefiele

If u buy a fridge for 100k den go to borrow money with same fridge as collateral, the lender decides hw much the fridge is worth and how much u pay back when u re ready to payback... apply same to currency if u keep borrowing, the lenders decide What your value is after checking ur export to import ratio, ease of business, security.

Hismasterpiece:
Hello.

Recently i have been hearing about the dollar going up in value.

And this has brought about a hike in the prices of commodities in the market and has also brought about a hike in the cost of living of the average Nigerian.

So things are tough in the country now because of this dollar phenomenon

So i would like to know what determines the value of a country's currency and why the Nigerian Naira appears to constantly reducing in value while that of America keeps going higher and higher.

Anybody with meaningful information is welcome. Thanks.

A very intelligent,fundamental and relevant questionquestion which reasonable Nigerians should be asking.


It is unfortunate that we have professors of Economics, Banking and Finance,Marketing,Business Administrations and related fields in our ivory towers and in financial institutions and grade and industry,but the ugly trend continues helplessly.

.Too shameful.

zubydave:
Let me try to explain the best I can; like some rightly put up there, the value of your currency is directly affected by the amount of the international legal tender; say the dollar for instance, that you have in your foreign reserve. Now the CBN determines the value of your naira to dollar- you hear cbn devalues the naira every now and then. They do this so as to control how much dollar you can take in bid to control what is left in the reserve. If they set a naira to a dollar for instance, now imagine how much will be left in the reserve if every tom and dick comes with a naira to collect a dollar. How much will be left for dangote and otedola who wants to import one thing or the other into Nigeria. My bad , I meant to say how much will be left for you and I that wants to import one laptop or iphone because if they set a dollar to a naira, the likes of dangote and otedola will empty the reserve in maybe a month, and there will not be enough to go round. So you see the secret to having a strong local currency value against the dollar, is to export more so that will can get more dollars into our reserve and the central bank will bring the value of the naira up against the dollar; as we would have had enough to go round. Now don't get it twisted, even if we have more than enough in our foreign reserve, the central bank can still put the value of the naira down against the dollar, which could be done maybe due to one economic policy or the other- china is a typical example. The want to control how much dollar they release back to the world.

Thank you this made sense to me. But I still don't get it 100%. If I say want to import a goods that's say is $500 and I pay with my atm card in naira equivalent. Are you saying my bank then request dollar from cbn for them to pay on my behalf in dollar?

For Nigeria it is BUHARI.

Productive base
Country's production export being greater than its import consumption.
Transparent application of budgeted funds for budgeted projects
If Nigeria can ONLY import what it needs and avoid luxuries like champagne, whiskey, and the like. Processing it's materials before exports instead of exporting the raw, the wealth wil be in our economy and demand for Forex would reduce.

Also having enough savings in foreign reserve that gives other countries confidence of dealing with you and ability that you will pay for what the sell you. Just like a broke man has no respect from people, broke countries and things they own have no value. But if you have money, and spend less than you earn, you have some degree of confidence and won't accept disrespect

The mentality of the citizens.

determinant are
1. favourable balance of payment
2. favourable balance of trade
which is realise from
export and import
d strength rely on
1. demands and supply
2. foreign reserves which will attract investment (fdi)
d unfortunate tin is we are not productive as a country we v high taste of foreign good

Dis guy na student.....He won gather ideas for here take write he project for school

As usual they will be talking nonsense














Nigeria devalued it’s currency to boast production

Price control policy
Foreign reserve
Inflation
GDP
Balance of trade( export/import)
Security
Government policy

SenatePresdo:


Why isn't Chinese yuan stronger than that of British pounds, because China is among the major export country in the world.

That is an intentional economic strategy by china, if china makes their currency to high automatically their goods become expensive and people would start looking elsewhere to buy.

But when Nigeria hasn't discover crude oil the NAIRA was valuable.

ITbomb:
When you don't produce anything that another country would need, your currency falls

If what you are producing is wanted by another country, your currency will be strong

Problem is that we depend on oil as we cannot produce any other thing, so when we were producing and selling oil at high quantities, our currency was stable.
Now that most buyers of oil are looking elsewhere, we don't sell enough to balance what we are buying from other countries, so our Naira falls

I believe this is "layman" enough