Topic: Nigerian naira hits record black market low of 1,100 per dollar - page 3. (Read 460 times)

The economy of Nigeria is currently on a live support machine, the economy is in dire need of respiration. Exporters are finding the situation not funny as they cannot get a good return in investment after bringing in goods into the country in hard currency, because inflation is on the high side, and local retailers purchasing power is weak. Nigeria is an oil producing state, just like Qatar and other oil nations that are doing well, so why is Nigeria own different.

I was not aware of the rates of the Naira/USD pair. Well, I am amazed and shocked to see how volatile your stable currency has become. I mean, it is moving like BTC. Our local currency, Pkr/USD, is around 278, and it has decreased in the past few days because the government suddenly came to know that they should do something otherwise the economy would collapse, and they started different operations against those who were holding black money in dollars.

And they recovered $900 million from the locals and also did many other operations to stop the robbery of gas, electricity, and water. And it also helped us minimize the PKR/dollar pair rate.

Well, I mentioned these because why don't your governments take such steps where they can control the rates? Well, we also take some loans too, but I don't know anything about Nigeria's economy, so I think I should look into it. But thanks for giving a historical overview of how things are going there.

Dollar has been a free fall in the unofficial market but that's not all, it's the same even in the official market place. The difference is the official market is protected under the watch of central bank, it's the Import and export(I and I windows) market you can officially buy USD but there is challenge of getting it quickly due to protocols and rules, so the only place to get it faster is unofficial (parallel) market where the price is slightly higher than the I and E windows.

Naira and dollar relationship has been finance by the fiscal and monetary policy where the government and the central banks have to intervene to fix an official price for the dollar to a naira which has been the traditional thing over the years but there is a new government in town that don't want to do that anymore because the government is the one funding the Forex and many loans have been taken over the years just to protect dollar to naira price. They decide to put an end to it and now allow everyone to go source their dollar by themselves, it's no longer the responsibility of the government to subsidies the price of dollar to a naira.

If they have allowed naira and dollar to be traded by the forces of demand and supply, it will probably have been or more than these price but the past government didn't allow that to happen and it's now that we are feeling the negative impact. I love how the government has stopped funding of dollars because it has allow the country to be in debts, even in US, they don't subsidized dollar to other currencies, they allow demand and supply to do his thing.

Naira has always been weaker to dollar, if really they have allowed the I and E windows all this while, problems like insecurities, low production would have been seen even from our currency but the government has been protecting it.

If the current government are serious about devaluing naira, they need to equally increase security accross the north, they need to fix the roads in all the 36 states in the country so that transportation of foods can be easy, they need to support local production, encourage export so that the country will also earn more dollars. It is going to be an advantage if the country fix exportation to get more dollars and reduce importation to increase the value of their own currency.

The bad thing is that he is not the only one, and it always happens in the same way, some leaders are determined to avoid history by repeating it. At present we have Argentina and Cuba, which are very similar cases: an official exchange rate is established by the government that nobody pays attention to and it is sold for a different one that is much more expensive on the black market. But there are many historical examples of this. In the end they will end up in bankruptcy and pure dollarisation or something similar.

Pathetic is an understatement. For a country who believes in devaluing it's currency on a daily by the sore dependency on imports, what do you expect? There are so many factors behind the fall in price of the naira but the major blame goes to the dwindling reserves and dollar inflows.As it is, there'sa desperate need to find a solution and the IMF had suggested Nigeria take a dollar loan from the fund to help cushion the effects but the question is how long will they keep being in debt?
 The way I see it, for every new government that takes over, they bring in new rules and scrap the former, not minding the damage it would cause; take the decision of the president to scrap fuel subsidy for instance. His ideas are weak and careless at best. I will not be surprised if he buys the idea of taking the loan. Is this where they need Bitcoin or has he got a plan for the naira?

The naira has lost its value to the dollar within just a short period of time, and this is something that citizens should be worried about and perhaps seek a self-solution. As a matter of fact, they can save their money in Bitcoin. From my calculation, if $1 was about ₦750, then you would spend about ₦22,500,000 to purchase 1 bitcoin (that's if 1
Bitcoin was $30k+). But as of the time of writing this comment, I checked on Binance, and $1 is about ₦1,156, which means to buy one bitcoin now, you will spend ₦33,004,956. Whereas, even when the price of Bitcoin is high and the value of Nair was not this bad, you will spend less naira to buy it. I believe that before the second quarter of next year, $1 might be worth $1,500 or more, so it's better that citizens prefer to keep their money in Bitcoin; if they also want to hold Fiat, then let them hold USDT or any other fiate that will not loss value like the naira.

Sincerely speaking the rate at which surge in price take effects is somewhat questionable on where are our economy are being driven to, as a matter of fact I have been trying to comprehend the sole purpose of what has caused the sudden increase with the period of 5 months after the sworn in our president. And I really want to understand something about the whole this whole things because when our ex-president were there we are like trying to question him on how the economy is not moving fine and how we lacking of employment..

I want to know why the price keeps increasing, or could it be that we are more consumers and not a producer or what because most at times I can't find the main reason why dollars keeps pressing over Naira, with how I have seen our economy and country whatever that has inflated in price always takes time to decreased just as we do have fuel price increase since from the first day he was made President, and we have been finding it difficult to cope with whole situation and now again we are talking of increase in dollars rate this shows the low export rate from our country to other countries, if we were high in exportation of products believe me we could had a kind of balance rate whereby Naira would keep surpassing Dollars or a kind of equilibrium in price.

No offense - but not very unexpected news. The direction towards “de-dollarization of the economy”, adopted unexpectedly, and having become a victim of the populism of some countries/politicians, is highly likely to lead to such a result. Drawing BRICS and de-dollarization, and essentially into the yuanization of the economy, is the path to the global economic bottom... The Nigerian government should think about whether they are choosing the right “friends”, and what this friendship will mean for them... The main thing is not to pass the point of no return, maybe there is still time for positive changes

Right from the announcement of the removal of fuel subsidy,  I've known that the country was already heading for doom and I guess I wasn't wrong with my thought.
If there is anyone to blame, then it should be the advisers to the presidency because I'm sure someone already engineered the removal of fuel subsidy to the president and that decision was really hasty and another matter to deliberate on is the issue with cement and the government sboukd try as muchbas possible to work on fixing fuel prices as well as prices of  cement if they want a sustainable economy.

It was all a hasty decision to announce withdrawal of fuel subsidy and that is the bane of the present economy. Diesel and kerosene have had subsidy removed years ago but it didn't cause the kind of economic confusion right now.

The government is inept to understand that the economy stands on fuel , that is the effect of being truthful to oneself and not to hastily take a decision that will hugely affect the greater number of the population and not just the fuel cabals like they are targeting.

They made a mistake for not fixing the refinery so that production will be at cheap rate meaning it also comes to the market relatively cheap , but now exportation of raw crude is still going on while importing it back as fuel using the dollar. There are infact so many reasons that the Naira has been crashing from 750 in May to #1250/$ in October.

Just for a record that it is now 1250/$ as the time of writing this post and I’m not shocked because I was already expecting all of this after the election and I’m not trying to politicize any of this but let the truth be told that, the government aren’t doing the right thing and aren’t also taking the right decisions and it is at the Cavour of those who earn in dollar but I still wonder the date of the common trade as well as those who don’t earn in dollar.

The government knows the right thing to do and I always feel ashamed knowing that I’m from a country that is supposed to be the faint of Africa but already turning to a mocking stock and I pray God speedily intervenes.

Exactly the reform of having to do away with the multiple exchange rate set by the apex bank in the past and now having a unified exchange rate would have been better if at all the banks have sufficient liquidity or supply to provide dollars for everyone because we can’t deny the fact that it is the exchange currency for almost all the international transactions. If the present government wants to stop subsidizing the naira against dollar, which I agree should have been stopped long time ago, they should provide an enabling mechanism to make sure everyone gets access to it freely. If they can’t then we might have to revert back to the old reforms pending when we have the industrial infrastructure to export more as this is the only way to make it get grounds against top currencies.

The parallel market will surely continue to push the dollar up because they are seriously holding much of it than they should

It is bouncing back because price of petrol and diesel are now moving like a clock the the seconds is moving. Even made in Nigeria product are also increasing and if we complain the say dollar is rising up, to my own understanding the present administration is not doing anything about it, they are just busy talking about palliative and the people are suffering the subsidy remover, with this situation foreigner are taking over our country in time of employment because of cheap labour.

At some point there is no going back. this stage has long been passed in Nigeria. Currently, the only possible scenario is a fall to zero and the release of a new currency, initially backed by something with high interest rates - like >20%. the government must build trust in the new currency and provide the appropriate risk/reward so that people are willing to risk having it but the current currency is already doomed to death

It is not envisage to get back to the good days of #150 to a dollar or even below.

If you are suggesting hodling the dollar then you could be speculating it to keep depreciating to #2,000 per dollar and that will certainly be disastrous for the people and the economy.  

The present administration seem not to have gotten it right when they removed fuel subsidy without proper planning and creating of unified exchange rate which caused hodling of the dollar and that caused scarcity. The point is that most economy rely on dollar for transaction and when you can't create a good manufacturing sector that will help support the foreign exchange then the pressure bounces back to the economy.

The situation in Nigeria is becoming more pathetic, this is not because the country is not doing well when it comes to GDP, but because they import more than what they export. The trade balance is always deficit and the USD and other foreign currencies are being dependent upon too much for the importation of goods and services, which is what is causing the issue in the country now.

IMF reviewed the situation this week and issued a clue that the country could start borrowing US dollars to cushion the effect of scarcity. The NGN was about two times lower than the current price last year, who knows what it would become this time next year.

Can it be possible for it to ever come down to ₦150?
 
If No, then people in that country will be encourage to buy more dollars for holding so that they will take the advantages of it in the future even though it will affect their economy because things has started to rise and if naira continue to rise against dollar then that's how things will continue too.

It's a dire situation for the currency and its holders.

It has been calling for the last decade now, from as low as N150 to $1 to N450 and then N750 climbing up to N1000, but the rate of collapse has never been this rapid. It usually bounces around with periods of increase and decrease in value, but now it's a one-way traffic.

A lot has to be done on the economy to revive that and create some demand for the currency.

Nigeria's naira hit a record low of 1,100 per dollar on the black market on Wednesday, online platform abokiFX showed, a day after the currency hit a new low on the official market due to persistent dollar shortages.

The naira has been in freefall on the unofficial market, where it trades freely, which worsened after currency restrictions were lifted on the official market.source