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Saturday 14 May 2016

Has the Naira Been Secretly Devalued? See What the CBN Has to Say About It

The Central Bank of Nigeria has finally reacted to the widespread reports that the Naira has been secretly devalued. It was being rumoured in some quarters that the Central Bank of Nigeria had secretly devalued the naira.
But, according to The Punch, when he was contacted, the spokesperson, CBN, Mr. Isaac Okoroafor, said it was not true that the naira had been devalued.
However, traders and financial experts have attributed the drop in the naira value to demand pressure from buyers, speculation, the announcement that fuel marketers should source forex from the secondary sources and hoarding.
The President, Association of Bureau De Change Operators of Nigeria, Alhaji Aminu Gwadabe, said, “More speculators are taking a position in the market, causing dollar scarcity and fall in the value of the naira. There is the need for intervention from the Central Bank of Nigeria. If not, the speculation will continue and the currency may fall to 380.”
The Head of Investment Research, Afrinvest West Africa Limited, Mr. Ayodeji Ebo, said if the CBN failed to take an immediate action by adjusting the naira, the pressure on the naira would be very significant.
He said, “I think the knee-jerk reaction being witnessed in the parallel market can be linked to new development within the oil space that now allows oil importers to buy foreign currency from the parallel market.”

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