CURRENCY EXCHANGE RATES FLUCTUATE AS NAIRA GAIN GROUND AGAINST DOLLAR, POUND AT PARALLEL MARKEt

As currency exchange rates continue to fluctuate, the Nigerian Naira as at Thursday, 9^th March, 2017, appreciated against the American Dollar and Pound Sterling at the Parallel market but crashed against the Euro.

Business reports as at yesterday, placed the value of the Naira per US Dollar at N462 against the N465 rate it was on Wednesday, 8^th March, 2017.

The Naira also reportedly appreciated to N550 against the Pound from the previous rate of N560.

Meanwhile, the Naira failed to appreciate against the Euro but crashed to N477 as against the previous rate of N475.

However, at the official market, the currency remained pegged at 305.80 to the dollar.

It will appear that the instability in the exchange rate could be attributed to excessive demand for dollars notwithstanding the liquidity boost in the FOREX market according to economist Harrison Owoh.

Owoh has said that the injection of 1.14 billion dollars by the Central Bank of Nigeria (CBN) to the interbank market were majorly at the service of letters of credits and invisibles. He added that it is the cash at hand that brings down the exchange rate not mere letters of credit.

Moreover, going by the FG’s economic plan released on Tuesday 7^th March, 2017, it can be said that a market-driven exchange rate regime is in the works.

Some experts then have argued that the Naira be allowed to float, its worth dictated by market forces owing to the fact that this will attract investors. However, the government insists that no country surrenders totally its currency to market forces while adding that it will intervene when necessary.

Whether or not the government has changed its mind, the expectation of Nigerians is to see that the Naira continues to appreciate and not crash against foreign currencies for it is a mark of the government’s productivity.