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Alarm bell sounded across Nigeria financial circles Tuesday as the local currency hit an all time low of 452 to a dollar and 570 to a pounds sterling in the parallel market.
this comes amidst reports that Nigeria’s foreign reserves have reduced from $26.51 billion in the second quarter of 2016 to $24.74 billion in September.
LAGOS PARALLEL MARKET RATES
ngn NGN usd USD gbp GBP eur EUR
BUY / SELL BUY / SELL BUY / SELL
27/09/16 445 / 452 560 / 570 475 / 488
The Naira had on Monday depreciated across segments of the foreign exchange market following increased demand for dollar to pay school fees abroad, coupled with speculative activities.
The nation’s currency fell to a record low of N445 against the US dollar at both the Bureaux De Change segment of foreign exchange market and parallel market.
It lost N5.00k or 1.14 percent compared to N442.00k closed on Friday last week at the parallel market. It also lost N6.00k or 1.36 percent as against N439 on Friday last week at the BDC segment.
At the inter-bank foreign exchange market, the local currency weakened against the dollar by N0,58k to close at N308.37k yesterday.
This represents 0.19 percent compared to N307.79k closed on Friday last week, data from FMDQ showed.
Meanwhile, The Minister of Budget and National Planning, Sen. Udoma Udo Udoma, has said that Nigeria’s foreign reserves have reduced from $26.51 billion in the second quarter of 2016 to $24.74 billion in September.
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Udoma on Tuesday said this at the 57th annual conference of Nigerian Economic Society with the theme “the developmental state and diversification of the Nigerian economy”.
He said Nigeria had revenue and foreign currency concentration problems, adding that diversification was the only solution.
The minister said due to four strategic pipeline terminals that were blown up, Nigeria had been unable to achieve its 2016 Budget production target of 2.2 million barrels a day.
Udoma said in August, the country was barely able to produce 1.1 million barrels.
He said, “Last week production level rose up to 1.7 million barrels, still a far cry from the country’s target of 2.2 million barrel.
“We are taking a number of immediate measures to raise revenues to strategically spend our way out of recession.
“We are taking measures to address the disruption in Niger Delta to restore production.
“We are fast tracking our efforts to raise foreign currency loans that we have projected in the 2016 budget, from AfDB, World Bank, Chinese Exim Bank as well as Euro Bond issue.
“We are happy to note that the president of AfDB has announced that we should expect, among other facilities, a budget support of $1 billion dollars next month.”
He said the economic management team had been working to assemble a stimulus package to be raised from concessioning advance payment for licence renewals, use of recovered funds and some asset sales.
Udoma said that the package was being worked upon and was yet to be finalised, adding that to achieve this speedily, “we are working to fast track procedures through presidential directives and legislation.
He said, “I want to emphasise that notwithstanding the current economic challenges we face, we are not discouraged at all and this is a crisis we must not waste.
