• Wednesday, February 21, 2024
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BusinessDay

Naira falls to N1,155 as market awaits Cardoso’s policy thrust at bankers’ dinner

Naira currently undervalued – Cardoso

Naira on Friday fell to N1,155 per dollar at the black market, following dollar shortage.

This represents 0.43 percent (N5) weaker than N1,150 exchanged on Thursday at the parallel market.

Naira also depreciated significantly at the official market, losing 13.78 percent as dollar flows dropped by 46.77 percent (N115.8) on Thursday.

Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN) is expected to make his first speech at the bankers’ dinner, where he will unveil his policy thrust.

The bankers’ dinner holding today in Lagos is being organized by the Chartered Institute of Bankers of Nigeria (CIBN).
Read also: Nigeria’s economy up 2.54% on services sector growth

Given the scraps of information since he took office in September, Friday’s address takes on greater significance. It could draw a line under the chaos that’s engulfed the central bank in recent months, Bloomberg reports.

The last interest-rate decision was in July, soon after Godwin Emefiele was suspended as the head of institution, and then arrested. The naira has been allowed more flexibility, and has plunged. Inflation is at an 18-year high.

Investors and importers will want to know how the central bank intends clearing a backlog of demand for dollars, manage the naira and narrow the gap between its value on the official and black markets.

Read also: Naira loses as dollar flows drop by 46.77%

There’ve been some hints: limiting intervention into the currency market and wiping out parallel trading — something more easily said than done.

The bank’s strategy will likely dovetail with the government’s economic policy, which President Bola Tinubu outlined in May and Cardoso co-authored. Other key points were igniting growth and scrapping costly fuel subsidies, a move that caused transportation prices to leap.