Naira Extends Fall Against Pound as UK Election Holds Today

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Image Credit: The Sun

By Adedapo Adesanya 

The Naira fell for the second consecutive day against the Pound Sterling at the parallel segment of the foreign exchange market on Wednesday, December 11, 2019. Voters in the United Kingdom will head to the poll today for the general election.

At the black market yesterday, the local currency lost N2 against the British currency to exchange at N472/£1 after going down to N470/£1 on Tuesday at the same market segment.

The performance of the British Pound has been pushed by investors on the expectation that the Conservatives led by Prime Minister Boris Johnson, an advocate for Britain’s exit from the European Union (EU), will win a majority in parliament during the general election on Thursday.

Observers in Nigeria believe that if this becomes the outcome today, the depreciation of the Nigerian currency against the Pound Sterling will persist at the parallel market.

At the same market yesterday, the Naira closed flat against both the US Dollar and the Euro. At the close of the midweek session, the Naira remained at the N360/$1 and N397/£1.

But at the Investors and Exporters (I&E) segment, the Naira appreciated marginally after the two previous sessions gave a different outcome. At the close of transactions on Wednesday, the Naira traded at N363.48 per Dollar, rising by 0.02 percent equivalent to 12 Kobo compared with N363.56/$1 it traded at the previous session.

This occurred amid a 420 percent or $499.19 million increase in the value of transactions at the market segment during the midweek session. A total of $618.08 million were recorded during the day compared with the $118.89 million exchanged on Tuesday.

However, at the interbank segment of the market, which is the official window of the Central Bank of Nigeria (CBN), the domestic currency remained unchanged at N306.90/$1.

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