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Again, Naira crashes to N550/$1 in parallel market

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NAIRA CRASHES

 

The Nigerian currency, the Naira suffered another major setback on Monday, losing N5 to close at N550 to a dollar at the parallel market.

The Naira has been under pressure for nearly two weeks, losing significantly at the official and parallel markets due to scarcity of dollars under a very high demand from manufacturers and foreign exchange end users.

The Naira exchanges at N410.51 to a dollar at the official market. The N139.49 rate disparity between the official and parallel market rates has led to massive hoarding of scarce dollars and abuse of Central Bank of Nigeria (CBN) guidelines on foreign exchange trading.

The naira depreciation against global currencies worsened after the CBN stopped dollar sales to bureaux de change (BDCs) and barred Microfinance banks from handling foreign exchange transactions.

The fall in the naira rate to this new low has been linked to dollar scarcity and forex speculators hoarding the available greenback to maximise profit.

READ  CBN devalues naira to N631/$1

In emailed guide to investors, the Managing Director, Financial Derivatives Company Limited, Bismarck Rewane, said delaying of the multiple exchange rate system which had bedeviled the economy had been a subject of controversy for a long period.

“Now that it appears settled we should expect a crawling peg method and an increase in forex supply to ensure equilibrium in the market. That notwithstanding, the CBN’s attempt to mop up excess liquidity could serve as a temporary antidote to consumer price inflation which still remains stubbornly high (18.12 per cent),” Rewanne, an economist, said.

Rewane had attributed the naira’s continued decline to heightened forex supply shortage, demand pressure and rationing.

He said naira rates convergence would require adoption of a full floating exchange rate system determined by the forces of demand and supply.

Likewise, the International Monetary Fund (IMF) said exchange rate rigidities have constrained the economy’s ability to absorb external shocks.

The IMF insisted that restrictions on access to foreign exchange for certain categories of goods, and multiple exchange rates create distortions in both private and public sectors decision making. They discourage long-term investment, encourage smuggling and provide avenues for corruption.

READ  Naira could trade below N1,000/$, says Goldman Sachs

Moving forward, the Fund suggested removal of foreign exchange restrictions, and a full exchange rate unification, in line with the authorities’ Economic Recovery and Growth Plan (ERGP), will help keep the parallel market premium low in a more sustained manner.

It therefore called for unified exchange rate for the naira to promote growth and attractive foreign capital.

According to the IMF, foreign exchange backlog and shortages are intensifying Balance of Payment (BoP) pressures insisting that exchange rate unification was imperative to reduce BoP risks. It said that fiscal deficit will stay elevated in the medium term, while additional domestic revenue mobilisation is required to reduce fiscal risks.

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BREAKING: Helicopter carrying Iran’s president ‘crashes’

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 A helicopter carrying Iranian President Ebrahim Raisi on Sunday afternoon crashed in northwestern Iran, Iranian state media reports.

 

It is unclear if Raisi and others on board with him survived the crash.

 

IRNA, the state media, reported that Hossein Amirabdollahian, foreign minister; Malek Rahmati, governor of East Azarbaijan province; and Hojjatoleslam Al Hashem, Tabriz Friday prayer leader, were also on board the helicopter.

 

Raisi was reported to be returning from a ceremony to open a dam on Iran’s border with Azerbaijan when the helicopter crash landed in the Varzaqan region.

 

The dam is the third one that the two nations built on the Aras River, and it comes amid chilly relations between the two countries.

 

IRNA added that rescue and relief teams have been dispatched to the area, and search operations continue.

 

The media outfit said the foggy weather and the impassability of the area have frustrated efforts.

READ  Lagos arraigns RCCG pastor for allegedly raping, impregnating daughter

 

There had been heavy rain and fog, along with some wind. IRNA called the area a “forest.”.

 

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We have done better than those who stayed eight years – Fubara

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Governor Siminalayi Fubara believes his administration has recorded giant strides in infrastructure since its inception about a year ago.

 

Fubara made the remark on Saturday in Ngo Town at the inauguration of the Andoni section of the Ogoni-Andoni-Opobo Unity Road project, Andoni Local Government Area.

 

While he did not mention any past administration, Fubara said since coming on board, his government has done well in the execution of projects, promising to do more for residents of the oil-rich state.

 

To the glory of God, we made history by commissioning the Andoni section of the Ogoni-Andoni-Opobo Unity Road.

The commissioning marks the end of a 24-year journey of constructing a road that connects three local government areas hitherto separated by water and a difficult… pic.twitter.com/NdsFhqYPkn

— Siminalayi Fubara (@SimFubaraKSC) May 18, 2024

 

“Like I said the other day, we just started. We started about three or four months ago but I am very happy that if we have to assess ourselves within that three months, we have done better than people who stayed for eight years,” the governor said. “I stand to be challenged.”

READ  Good morning! Here Are Some Major News Headlines In The Newspapers Today: Angry traders set Abuja market on fire

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Good Morning! Here Are Some Major News Headlines In The Newspapers This Beautiful Sunday: Soldiers storm Abuja market over attack on colleagues

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1. Soldiers on Saturday stormed Banex Market in Abuja over the assault on some of their colleagues. A mob had descended on at least two soldiers in the markets where electronic gadgets and mobile phones are mostly sold. Some traders closed for the day and fled home to apparently avoid being caught up in a reprisal attack.

 

2. Africa’s richest man and chairman of the Dangote Group, Aliko Dangote, says with the plan by the Dangote Refinery, Nigeria will not need to import gasoline by June, this year. Speaking at the Africa CEO Forum Annual Summit in Kigali on Friday, he said the refinery had started supplying diesel and aviation fuel in Nigeria.

 

3. The Oba of Benin, Omo N’Oba N’Edo, Uku Akpolokpolo, Ewuare II, has received two looted royal stools carted away during the invasion of Benin City in 1897, from the German government. The artefacts — bronze and wooden royal stools (Ekete), were looted during the reign of Oba Eresoyen and Oba Esigie several centuries ago.

READ  Port Harcourt refinery resumes operation after years of shutdown

 

4. President Bola Ahmed Tinubu has appointed former Secretary to the Government of the Federation, Alhaji Yayale Ahmed, former Bauchi Governor, Alhaji Isa Yuguda, and former INEC Chairman, Prof Attahiru Jega, and others to serve in the newly released list of federal universities’ governing councils.

 

5. Rivers Governor, Siminalayi Fubara has lamented that his administration only settled down to work three months ago due to the crisis rocking the State. Fubara said despite the delay, his government had achieved better project and service delivery than the eight years of government of some other administrations.

 

6. Tragedy struck in Ode-Omu town in Ayedaade local government area of Osun State on Saturday after a private car crushed a mother and two children returning from vigil to death. It was gathered that they were crushed to death while on a motorcycle. The rider simply identified as Abraham also died.

 

7. The presidency has dismissed the planned alliance between former Vice President Atiku Abubakar and former governor of Anambra State, Peter Obi. According to the presidency, President Bola Tinubu is not bothered about the planned alliance, noting that the President was not losing sleep.

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8. A yet-to-be-identified middle-aged man has died while watching football at a local bar along the Lagos-Abeokuta Expressway. It was gathered that the incident happened on Thursday, May 16. The deceased, who was a regular customer in the open bar, was said to have walked in, sat down, and started to watch a football match until he fell asleep.

 

9. The Nigeria Security and Civil Defence Corps Commandant General’s Special Intelligence Squad has dismantled an illegal refining site containing over 100,000 litres of stolen crude oil in Adobe settlement, Etche Local Government Area, Rivers State. The Commander of the CG’s SIS, Dandaura Apollos, said the success resulted from credible intelligence indicating that suspects had vandalised a multinational company’s wellhead.

 

10. The Adamawa State Police Command has arrested a 23-year-old stepmother, Rachel Geoffrey, for allegedly inflicting severe burns on her 7-year-old and 3-year-old stepchildren. According to the police, the stepmother intentionally set fire to the children’s hands as punishment for eating food she had saved for their father.

READ  Good morning! Here Are Some Major News Headlines In The Newspapers Today: SEC to delist Naira from P2P space to curb manipulations

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