Sep 20, 2021

Mawazo Writing Africa

Writing about the main

Dollar close to breaking N550/$ psychological barriers panic buying, hoarding continue

No intention of converting the income from the Dom account into naira, says CBN
Speculative trading intensified on the parallel currency exchange market over the weekend as the naira moved towards N550 / $ amid mounting scarcity.

What looked like a terrible week for the local currency has deteriorated in recent times two days, with the exchange rate hovering around N545 / $ yesterday at noon in Lagos.

The results have shown that many black market traders have run out of currency while the few who have been unwilling are to sell. Traders, it was learned, are currently on a clean-up process, a situation that has turned the black market segment into a seller’s market.

If the speculative tendency continues into next week, traders said the troubled naira could hit new low of N600 / $. The supply shock continues to mount and the dollar only needs to break the psychological N550 / $ line to get towards N600 / $.

The naira is stabilizing above N500 / $ for the first time. It exceeded / $ N500 during the famous 2017 crisis but declined shortly after it crossed the mark.

The Guardian reported Friday that the Depository Banks (DMBs) have put sole responsibility for the sale of Private / Business Travel Users (PBTA) have resorted to searching for rentals after the displacement of Currency Exchange Operators (BDC).

It has been reported that banks are exploring the black market while denying access by end users on FX under the guise of unacceptable documentation. Meanwhile, banks have continued to claim that they have more than enough to donate to those in need.

Speaking to The Guardian, Central Bank of Nigeria (CBN) director of corporate communications, Osita Nwanisobi , said banks had enough foreign exchange in their vaults to give money to deserving individuals.

According to the report, the top warned of “bad practice” in foreign exchange. She warned that “the FX operating license of one or more banks found guilty of the ongoing investigation will be suspended for at least one year.”

After the worsening currency crisis, Apex Bank distanced itself of media reports asking for domicile account earnings to be converted to naira, saying, “The bank has not and will never consider such an approach”.

One from Nwanisobi. The signed statement, said: “The CBN’s attention has been drawn to a fake distribution in social media circles of a circular with a fake CBN logo, oddly enough, by the 13th DMBs, International Money Transfer Operators (IMTOs) and the general public need the Convert domicile account holdings to naira.

“We would like to reiterate that the bank has not and will never consider doing this. The speculation is an entirely false narrative aimed at creating panic in the forex market. It is worth remembering that the bank had previously assured the public that there were no plans to convert the foreign currency in clients’ domicile accounts to naira in order to verify the alleged availability of US dollars. “