Dear All, Earlier today, the Central Bank of Nigeria released a Circular excluding the following items of import from the Retail Dutch Auction (RDAS) Window; henceforth the funding for the items will be from the interbank foreign exchange market. These items are: 1. Electronics 2. Finished products 3. Information Technology 4. Generators 5. Telecommunication Equipment 6. Invisible transactions Market Impact Coming at a time when there is already a significant demand pressure on the interbank market from offshore portfolio investors who are seeking to repatriate their funds, the immediate impact of the announcement was a further depreciation in the USDNGN exchange rate at the interbank segment to . Historically, these items constitute about 35% of RDAS volumes – which indicates that, all other things being equal, this will increase monthly demand at the interbank by about USD1.12 billion Our expectations is that, while the CBN might intervene in the interbank markets, the exchange rate will hover between 167 – 172 over the coming weeks. Please note that the Circular takes effect immediately. Nigerias economy is collapzing day by day.....We might need a magician to rejuvenate.
Posted on: Thu, 06 Nov 2014 12:59:55 +0000
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