There were indications this week that the foreign exchange market may witness another round of sustained appreciation of the local currency, Naira, against world’s major currencies at the parallel market segment while narrowing the premium.
This came at the backdrop of the resolve of the Central Bank of Nigeria, CBN, to sustain its fight against currency speculators which has entered the third week.
The apex bank, Vanguard learnt, intends to sustain the fight with an adequate supply of foreign exchange to all segments of the market while addressing imperfections and arbitraging with market intelligence and heavy sanctions on infractions by authorised dealers.
At the parallel market, the Naira/Dollar exchange rate closed at N462.00/US$1.00 last weekend, a moderate appreciation against the N465/USD high point reached during the week.
Market analysts at Afrinvest West Africa Limited, a Lagos-based investment house are of the view that the CBN’s bullish interventions in the past two weeks are beginning to down on speculators’ attacks which had pressured rates beyond N500/USD last month.
They expect this development to rein in on exchange rates going forward. Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele stated: “In the week ahead, we expect the Central Bank to continue intervening with dollar sales at the interbank market while the exchange rate is projected to hover around current levels at that segment of the market.
“Also, the CBN’s circular mandating banks to process and meet demands for PTA and BTA within 24 hours and School fees and Medical bills within 48 hours of application could further drive dollar demands to the official market, thereby relieving some of the pressure on the parallel market.”
(VANGUARD)
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