Economy

CBN FX Policies Discouraging Foreign Investors—Muda Yusuf

Published

4 years ago

02/08/2021

By Ashemiriogwa Emmanuel

The immediate past director-general (DG) of the Lagos Chamber of Commerce Industry (LCCI), Mr Muda Yusuf, has blamed the Central Bank of Nigeria (CBN) for the low influx of foreign investors into the country, especially through foreign direct investments (FDIs).

According to the economic expert, the policies of the apex bank as regards the foreign exchange (FX) cannot attract investors into the country.

Mr Yusuf, while speaking last week on Fact File, a programme anchored by Mr Tayo Somide on RayPower FM, said no investor will want to bring in forex at N410 when it trades at over N500 at the open market.

The former LCCI DG was reacting to the decision of the CBN to stop the sale of FX to Bureaux De Change (BDC) operators on allegations of illicit FX flows.

During the 30-minute programme monitored by Business Post in Lagos, Mr Yusuf said the central bank must make efforts to collapse the forex rates into one to make it attractive to foreign investors.

Last week, the National Bureau of Statistics (NBS) said in the second quarter of 2021, capital importation declined by 54.06 per cent quarter-on-quarter to $875.6 million from $1.9 billion in the first quarter of this year.

On a year-on-year basis, the capital inflows also went down by 32.38 per cent as the inflows in the same period of last year was $1.3 billion.

For Mr Yusuf, this will continue except the CBN FX policies are attractive to foreign investors and efforts must be made to work on the demand side of the market.

According to him, the apex bank should focus more on ‘demand management,’ suggesting that the bank should build more on the supply pressure by reviewing the exchange rate at the Investors & Exporters (I&E) window in order to encourage investors to bring in their foreign currency to the economy.

According to the former DG, “When you are talking about foreign exchange, there are two sides to it; there is the demand pressure, and the supply side.

“We need to do a lot more around issues of supply. When you fix the rate at, say, N410/$1 and expect people to bring in their foreign currency at such a rate, will they bring it, knowing that the open market is around N500/$1? So, in a way, we are blocking the supply of forex to the official system,” he submitted.

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He also warned that the discontinuation of forex sales to BDCs will cause inflation to spike again after easing for the past three months. It moderated to 17.75 per cent in June, according to the NBS.

According to him, inflation will push prices of goods upwards as sellers will begin to change their prices.

While commenting on the announcement made by the CBN Governor, Mr Godwin Emiefele, to launch e-naira in October, Mr Yusuf emphasised the importance of ensuring an appropriate regulatory framework before going down such a route.

He compared the difficulty in monitoring the activities of digital currencies in other countries and reiterated the need to ensure that the introduction of e-naira does not come as a threat to the country’s financial system.

“There is no system that cannot be abused and sometimes, some of these digital currencies can be difficult to regulate.

“I think the CBN is having a second thought about it. But what is important is that we have an effective and robust regulatory framework and that the introduction of the e-naira does create room for illicit transactions,” he said.

Economy

Nipco, 11 Plc Crash OTC Securities Exchange by 4.76%

Published

60 minutes ago

06/12/2025

Adedapo Adesanya

By Adedapo Adesanya

Energy stocks influenced the 4.76 per cent loss recorded by the NASD Over-the-Counter (OTC) Securities Exchange on Friday, December 5.

The culprits were the duo of 11 Plc and Nipco Plc,with the former shedding N32.17 to end at N291.83 per share compared with the previous day’s N324.00 per share, and the latter down by N21.00 to sell at N195.00 per unit versus the previous session’s N216.00 per unit.

Consequently, the NASD Unlisted Security Index (NSI) slumped by 170.16 points to 3,401.37 points from 3,571.53 points and the market capitalisation lost N101.81 billion to close at N2.035 billion from the N2.136 trillion quoted in the preceding session.

The OTC securities exchange suffered the decline yesterday despite the share prices of three companies closing green.

Central Securities Clearing System (CSCS) Plc was up by N1.80 to close at N39.80 per share compared with Thursday’s price of N38.00 per share, Air Liquide Plc appreciated by N1.09 to N11.99 per unit from N10.90 per unit, and FrieslandCampina Wamco Nigeria Plc grew by 78 Kobo to N56.57 per share from N55.79 per share.

During the session, the volume of transactions rose by 6,885.3 per cent to 18.2 million units from 4.3 million units, the value of transactions ballooned by 10,301.7 per cent to N389.7 million from N347.2 million, but the number of deals declined by 29.7 per cent to 26 deals from 37 deals.

Infrastructure Credit Guarantee Company (InfraCredit) Plc ended the day as the most traded stock by value on a year-to-date basis with 5.8 billion units worth N16.4 billion, followed by Okitipupa Plc with 170.4 million units valued at N8.0 billion, and Air Liquide Plc with 507.5 million units worth N4.2 billion.

InfraCredit Plc also finished the day as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units worth N524.9 million.

Economy

Naira Depreciates to N1,450/$1 at Official Forex Market

Published

1 hour ago

06/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira depreciated further against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, December 5, as FX demand pressure mounts.

The Nigerian currency lost N2.60 or 0.18 per cent against the greenback to close at N1,450.43/$1 compared with the previous day’s N1,447.83/$1.

Equally, the domestic currency declined against the Pound Sterling in the official forex market during the session by N4.48 to trade at N1,935.45/£1, in contrast to Thursday’s closing price of N1,930.97/£1 and shrank against the Euro by 43 Kobo to end at N1,689.17/€1 versus the preceding session’s rate of N1,688.74/€1.

Similarly, the local currency performed badly against the US Dollar at the GTBank FX counter by N2 to close at N1,455/$1 versus Thursday’s N1,453/$1 but traded flat at the parallel market at N14.65/$1.

As the country gets into the festive period, pressure mounted on the local currency reflecting higher foreign payments and lower FX inflows.

However, there are expectations that the Nigerian currency will be stable, supported by interventions by to the Central Bank of Nigeria (CBN) in the face of steady dollar Demand and inflows from Detty December festivities that will give the Naira a boost after it depreciated mildly last month.

Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450/$1 next week, buoyed by improved FX interventions by the apex bank.

As for the crypto market, it was down yesterday due to profit-taking associated with year-end trading. However, the December 1-Year Consumer Inflation Expectation by the University of Michigan fell to 4.1 per cent from 4.5 per cent previously and 4.5 per cent expected. The 5-Year Consumer Inflation Expectation fell to 3.2 per cent from 3.4 per cent previously and 3.4 per cent expected.

With the dearth of official economic data of late, these private surveys have taken on a new level of significance and the market banks of them to make decisions.

Cardano (ADA) depreciated by 5.7 per cent to $0.4142, Dogecoin (DOGE) slid by 5.1 per cent to $0.1394, Ethereum (ETH) dropped by 3.9 per cent to $3,039.75, Solana (SOL) declined by 3.8 per cent to $133.24, and Litecoin (LTC) fell by 3.7 per cent to $80.59.

Further, Bitcoin (BTC) went down by 2.6 per cent to sell at $89,683.72, Binance Coin (BNB) slumped by 2.2 per cent to $883.59, and Ripple (XRP) shrank by 2.1 per cent to $2.04, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.

Economy

Oil Market Climbs on Federal Reserve Rate-Cut Signals, Supply Concerns

Published

2 hours ago

06/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The oil market was up on Friday on increasing expectations the US Federal Reserve will cut interest rates next week, which could boost economic growth and energy demand.

Brent futures rose by 49 cents or 0.8 per cent to $63.75 per barrel and the US West Texas Intermediate (WTI) futures expanded by 41 cents or 0.7 per cent to $60.08 per barrel.

Investors digested a US inflation report and recalibrated expectations for the Federal Reserve to reduce rates at its December 9-10 meeting.

US consumer spending increased moderately in September after three straight months of solid gains, suggesting a loss of momentum in the economy at the end of the third quarter as a lackluster labor market and the rising cost of living curbed demand.

Traders have been pricing in an 87 per cent chance that the US central bank will lower borrowing costs by 25 basis points next week, according to CME Group’s FedWatch Tool.

Investors also focused on news from Russia and Venezuela to determine whether oil supplies from the two sanctioned members of the Organisation of the Petroleum Exporting Countries and allies (OPEC+) will increase or decrease in the future.

The failure of US talks in Moscow to achieve any significant breakthrough over the war in Ukraine has helped to boost oil prices so far this week.

A loss of Venezuelan oil production in case of a US military intervention will materially impact global benchmark prices as the market will have to replace Venezuela’s heavy crude.

Venezuela is estimated to pump about 1.1 million barrels per day of crude oil at present, so if the US-Venezuela tension escalation into an invasion in the South American country, this volume of crude would be at risk.

Reuters reported that the Group of Seven countries and the European Union are in talks to replace a price cap on Russian oil exports with a full maritime services ban in a bid to reduce the oil revenue that helps finance Russia’s war in Ukraine.

Any deal that could lift sanctions on Russia, the world’s second-biggest crude producer after the US, could increase the amount of oil available to global markets, weakening prices.