Posted by Collins Nweze | 1 October 2018 | 1,055 times
The naira has been firming up in the last few days as politicians pumped stockpiled dollars into the economy for campaigns, The Nation has learnt.
The naira, which exchanging at N361 to dollar early last week, firmed at N357 in the parallel market at the weekend, as politicians flooded the market with the greenback. Major political parties have been conducting their governorship primaries.
Speaking on the development, President, Association of Bureaux De Change Operators of Nigeria (ABCON) President Aminu Gwadabe said: “several customers were seen at the weekend, flooding the market with dollars possibly for primary elections and screening across party lines”.
He said the Bureau de Change (BDC) operators were taking advantage of the development to earn commissions from naira exchanges for the dollars, adding that the naira has made considerable gains in the last few days.
The primary season and pre-election spending have been building up since the beginning of September and will continue till early next year when elections will take place.
Other analysts said the naira was fast appreciating following renewed confidence and increase in dollar supply in the parallel market.
Also, the Central Bank of Nigeria (CBN) has consistently warned that the economy faces inflation and financial stability risks over the short-to-medium-term if expected huge election spending is not checked.
CBN Deputy Governor (Corporate Services) Adamu Edward Lamtek explained in his personal statement at the Monetary Policy Committee (MPC) meeting released by the CBN that confidence in the economy was building as the naira exchange rate continues to be stable and the premium between the bureau de change and interbank market segments narrows.
• Excerpted from The Nation report
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