News
Naira Crashes To 1,030 per dollar As Speculators React
The naira crashed against the dollar on Monday, falling to 1, 030/$ on the average in the parallel market, losing the momentum it gathered last week.
This represents a N80 loss or a 8.42 per cent decline of the local currency compared to the N950 it closed the week at last Friday.
This is also the first time the naira is falling since the Central Bank of Nigeria began to clear some of its FX backlog last week.
Currency traders, also known as Bureaux De Change operators, told The PUNCH that the naira was trading at between N990 to N1,030/$.
A trader who gave his name as Awolu said, “The dollar is N995 if you want to sell. If you want to buy from me, it is N1,020.” Another trader, Kadri, added, “The dollar is N960 if you want to sell. If you want to buy, it is N990.”
According to the President of the Association of Bureaux De Change Operators of Nigeria, Aminu Gwadabe, the dollar has gained against the naira because people who had bought it at a higher price are resisting its fall following the Central Bank of Nigeria’s move last week.
Last week, the apex bank has commenced the payment of outstanding matured FX forwards owed to various banks.
This was meant to boost liquidity in the foreign exchange market following weeks of the naira falling to record lows. According to the Minister of Finance, Wale Edun, the amount of overdue forward payments was about $6.7bn.
This move quickly led to the appreciation of the naira with the naira gaining about N220 after closing the week at N950/dollar at the parallel market. The naira has now seemingly lost this momentum. Confirming the closing price of the dollar to The PUNCH, Gwadabe said, “In the afternoon, it was N1,015 and N1,020/$. It closed at N1,030/$.”
He highlighted, “Speculators are always looking at elements of sustainability. Once they sense that it (the injection) is not continuous, they begin to react. They begin to react. It is the reaction of the market we are witnessing. Also, there is resistance. There are people that bought at a higher price that this does not favour. People are not willing to take further losses.
“The only way we can continue to achieve the rate is by continuing to send confidence to the market. Tell the market that another window is opening, and boost liquidity. The parallel market is where the retail end is. And as of now, there is no information as to how liquidity will come into that sector. All we have is that BDCs will be included to advance the official foreign exchange market. We cannot wait in the FX market.”
Also, the naira declined by 3.6 per cent at the official market to close at N809.02 to the dollar on Monday from N780.23/$ on Friday according to details on FMDQ OTC Securities Exchange.
The Federal Road Safety Corps (FRSC), Anambra State Sector Command, has confirmed the death of a woman in an accident at Okpoko Market on the Asaba-Onitsha Road.
The Sector Commander, Mr Adeoye Irelewuyi, who confirmed the accident to journalists in Awka on Thursday, said that the woman was hit while she was crossing the road.
He said that the accident, which occurred on Wednesday, involved a commercial tow truck with registration number XA550BMA.
“Eyewitness report reaching us indicates that the truck was towing a vehicle in an uncontrollable speed along the axis.
“The vehicle that was being towed got detached from the tow truck.
“It hit and killed a female adult, who was said to be crossing the road, while the tow truck continued its movement.
“FRSC rescue team came to the scene and took the woman to Toronto Hospital, Onitsha, where she was confirmed dead and her body deposited at the hospital’s mortuary,” he said.
While sympathising with the family of the dead, the sector commander urged motorists, especially tow truck drivers, to exercise a high level of professionalism.
He also urged the drivers to always use standard equipment and avoid speeding.
The Chairman, Poultry Association of Nigeria (PAN), Lagos State Chapter, Mr Mojeed Iyiola, said the state government’s maize palliative to members of the association made a positive impact on the sector.
Iyiola said this in an interview with the News Agency of Nigeria (NAN) on Thursday in Lagos.
“We received about 150,000 tons of maize in February from the Lagos State government as palliative to cushion the effect of high feed prices.
“The major benefit of the palliative is that it actually cushioned the cost of production for most poultry farmers in the state.
“The palliative was beneficial as it made the cost of some poultry produce, especially eggs to drop,” Iyiola said.
He noted that prior to the palliative, a crate of egg was sold between N3,500 and N3,700 at the farm gate, but after the palliative, it now sells between N3,200 and N3,400.
According to the PAN chair, retailers and middlemen who sell from N3,800 to N4,200 do that for their personal gain.
“We have urged our members to sell their eggs at reasonable prices following the receipt of the palliative from the government.
“We appreciate the Lagos State government for the palliative but we also urge the federal government to do likewise, to further reduce the cost of production in the sector.
“This will consequently lead to drop in the prices of all poultry produce across board,” he said.
He said the palliative was shared among financial members of the association at no extra cost.
“As an association we shared the grains equally across PAN’s eight zones in the state equally. We also mandated each zone not the sell even a grain of the maize.
“We, however, considered new poultry farmers who wanted to the join the association as beneficiaries of the palliative,” said Iyiola.
He noted that through the palliative, more poultry farmers were recruited into the association.
“The maize was shared only to poultry farmers and not feed millers, it is the major component of poultry feed formulation,” he said.
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