Naira appreciates against the dollar to N240
The Naira rose against the dollar in the parallel market to N240 from N310, before the close of business yesterday, while the official Central Bank of Nigeria rate remained unchanged at N197. The rise of the Naira defied speculation of further depreciation to about N450 this week after reaching an all-time low of about N400 to the dollar in the parallel market last week.
There has been widespread belief that the Naira appreciation is somehow due to Dr. Ifeanyi Ubah, the CEO of Capital Oil, after his statements on national television on Sunday, where he claimed that he could restore the value of the Naira to 200 in 30 days. He said, further, that the decrease in the value of the dollar has been largely artificial and due to manipulation by certain people.
Surprisingly, the Naira appreciated in the parallel market and is currently hovering around 310 to 340 Naira.
Contrary to this popular belief, Mr. Kunle Ezun, Currency Strategist in Ecobank Nigeria, attributed the rise of the Naira to President Buhari’s defiance on devaluation and the decision of the Bureau De Change (BDC) operators to peg their profit margin at 3.5 percent.
In a bid to ensure further appreciation of the Naira and enhance transparency in the the BDC sub-sector, the chairman of the Association of Bureau de Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, revealed plans to introduce a foreign exchange rate band weekly, which would be announced via press releases.
The forex market appears to be moving from perception to reality as the weekly forex rate band will serve as a guide for all BDCs and help curb further exploitation of forex end users, he added.
Only time will tell whether or not Dr. Ifeanyi Ubah is the saviour of the Naira, or just a mere coincidence that the Naira appreciated after his statements.