The issue of the devaluation of the Naira has been one of the policies implemented by the CBN governor, Godwin Emefiele that has generated different reactions from Nigerians. While some are condemning this action by the CBN, owning to the current economic challenges facing the country,
others believe that the move by the appex bank will help stabilize the rate of the naira against the dollar. Although the elite and the rich seem to be benefiting from the current fall of the naira, many Nigerians believe it is going to weaken the purchasing power of naira of which only the common people will suffer. While the country is trying to adjust and adapt to the current situation, it seems the CBN is making another attempt to further devalue the naira.
According to Naij.com, Bloomberg reports that the CBN will make the announcement of the new policy this week.....READ the copy of the full story from NAIJ.com!!!
CBN plans new policy to weaken Naira
Bloomberg quoted an unnamed source who attended a meeting between Godwin Emefiele, the CBN governor, and bankers as confirming that CBN will make the announcement this week – Analysts have said they expect the central bank to allow the naira to weaken around a trading band in the interbank market – President of the Bureau de Change Operators of Nigeria is optimistic that the black market rate may strengthen if the official exchange rate is weakened All other things being equal, the Central Bank of Nigeria (CBN) will further weaken the naira within this week, Bloomberg is reporting. Share on Facebook Share on Twitter Muhammadu Buhari, president of Nigeria The report further said the CBN will introduce a dual exchange-rate system as it unveils a new policy to the effect in few days from now. Bloomberg quoted an unnamed source who attended a meeting between Godwin Emefiele, the CBN governor, and bankers on June 9 where the issue was discussed. The source said the meeting held in Abuja and that the announcement would be made in a circular to banks later this week. Analysts including those at Renaissance Capital Ltd have said they expect the central bank to allow the naira to weaken around a trading band in the interbank market, while allocating dollars at a fixed rate to industries the government deems strategic. The announcement is yet to be made because the apex bank is believed to be putting finishing touches to the policy which may also reinstate a minimum holding period for foreign investors buying naira bonds, the report said. While analysts argue that Nigeria is not a conducive country for investors currently, the naira has continued to weaken since the last effort made to devalue it. President Muhammadu Buhari, for many months, refused to devalue the currency arguing that this would cause inflation. But with inflation for May announced to be at N15.6, the prices of commodities are already high thus betraying the argument. The report however quoted Aminu Gwadabe, president of the Bureau de Change Operators of Nigeria as saying that the black market rate may strengthen if the official exchange rate is weakened while inflows from investors would pick up. Speaking from Lagos, he said: “The naira might trade around 300 to a dollar on the black market after the announcement, because we expect supply to improve.” A report by The Will mid-May had said President Muhammadu Buhari has given his nod for the further devaluation of the naira. NAIJ.com
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