Naira defies speculations, trades below N300 per dollar

2016-01-19
THE GUARDIAN Newspaper- Chijioke Nelson


Fear of further fall in the value of the naira in the week at the parallel market has been assuaged as the local unit traded below N300 yesterday, far from the N320 per dollar speculated.

Specifically, the naira, on the average, traded between N285 and N293 at various locations in Lagos and across cities- Abuja, Kano and Port Harcourt.

A Bureau De Change (BDC) operator who pleaded anonymity told The Guardian that the new relative stability in the parallel market was a result of the weekend’s truce between the Central Bank of Nigeria (CBN) and the leadership of the currency traders association.

The CBN had relaxed the rule due to persistent pressure from BDC operators and other stakeholders as it substituted outright ban on dollar sales to the segment with the option of dollars sales from the International Oil Companies (IOCs).

The decision to use foreign exchange earnings from IOCs, which is part of the autonomous sources, was reached at the end of a meeting the apex bank had with the Association of Bureau De Change Operators of Nigeria (ABCON).

“But I think the relative calm is more about expectations and market reactions in a wait to see what the agreement would result to. If there is frustration along the line, believe me, the situation may reverse,” he said.

Meanwhile, in what looks like the commercial banks are now back to the business, direct e-mail and text messaging have flooded the contacts of accounts holders, assuring a hitch- free foreign transfers and other related transactions.

The development, especially took a dramatic turn at the weekend, with the confirmation of the CBN that PoS and online transactions in dollar can be done to the tune of $2000, while Automated Teller Machine withdrawal remains at $300 per day.

The messaging also indicated that it is now possible to allow deposits of foreign currency to be transferred abroad from their accounts.
About one week ago, the apex bank announced that it would allow commercial banks to accept cash deposits of foreign currency, reversing a restriction imposed last year when such deposits were banned to curb speculation.

 

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