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LequteMan
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The Nigerian naira at the end of trading at the interbank market on Monday fell further to exchange at N280 per dollar, a 29 percent slide.
The currency had hovered around the 260 level as the Central Bank of Nigeria was said to sell dollars to help clear pent-up demand for foreign currency.
In addition, traders say the naira will further depreciate more than 10 percent in three months, forward contracts show.
“They can’t do this for months,” said Jonas David, a Zurich-based emerging-markets analyst at UBS Wealth Management. “‘We could see further pressure on naira to levels close to 300.”
There may be “higher volatility until the market becomes more functional,” Samir Gadio, head of Africa strategy at Standard Chartered Bank Ltd. in London. “Foreign investors will need to be convinced that the new foreign-exchange platform is sustainable before they resume the purchase of local assets.”
Bloomberg
The currency had hovered around the 260 level as the Central Bank of Nigeria was said to sell dollars to help clear pent-up demand for foreign currency.
In addition, traders say the naira will further depreciate more than 10 percent in three months, forward contracts show.
“They can’t do this for months,” said Jonas David, a Zurich-based emerging-markets analyst at UBS Wealth Management. “‘We could see further pressure on naira to levels close to 300.”
There may be “higher volatility until the market becomes more functional,” Samir Gadio, head of Africa strategy at Standard Chartered Bank Ltd. in London. “Foreign investors will need to be convinced that the new foreign-exchange platform is sustainable before they resume the purchase of local assets.”
Bloomberg
