Business

U.S dollar at a three-month high adds more pressure on naira

Published

10 months ago

February 14, 2024

U.S dollar at a three-month high adds more pressure on naira

The haven currency traded near three-month highs to major peers on Wednesday giving the naira little room to maneuver as forex traders pushed back bets for a first Federal Reserve interest rate cut following surprisingly hot U.S. inflation figures overnight.

The naira traded settled around N1,499/ from an all-time low of N1,534/$ on the official Nigerian Autonomous Foreign Exchange Market.

At the black market where residents who can’t access the official market are forced to obtain foreign currency, the naira traded stronger at N1,517 per dollar

The naira is facing strong headwinds as the availability of the greenback in local markets plummeted sharply, adding pressure on CBN to raise interest rates to attract foreign exchange inflows at its policy meeting scheduled to be held later this month

The CBN at the start of the year has taken several monetary actions to improve investor confidence, pricing, and market dollar liquidity.

The CBN’s chief, Mr. Yemi Cardoso informed lawmakers that FPIs have already started to provide the economy with much-needed foreign cash because of the changes, revealing that more than $1 billion has been drawn into the market consequently.

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The US Consumer Price Index (CPI) reported headline and core inflation figures for the monthly and annual benchmarks that were higher than anticipated.

The positive surprise is a cold shower for markets that were expecting deeper deflation and were solely concerned about a rate cut in March or June. Given these circumstances, even a rate cut in June is beginning to seem quite unlikely.

According to LSEG’s rate probability app, federal funds futures currently price in no rate cut in March and a lower than 50% chance of easing in May. This comes after the U.S. consumer price index (CPI) increased 3.1% from a year ago in January, compared with an estimated 2.9% rise.

The recent CPI report has indicated that the disinflationary path that investors had anticipated no longer reflects the real scenario.

March rate reductions are implausible, and as of right now, June rate cuts seem improbable as well. It’s now time for another push-and-pull readjustment in the US dollar, with the DXY moving to 105 and greater upside this time.

There is still one more CPI report, and the March decision is more than a month away. The US dollar strengthened, and the markets took a hit, but volatility is expected to persist.

U.S dollar at a three-month high adds more pressure on naira

Railway

Lagos Rail Mass Transit part of FG free train ride – NRC

Published

21 hours ago

December 21, 2024

Trends Admin

Lagos Rail Mass Transit part of FG free train ride – NRC

The Nigerian Railway Corporation (NRC) has disclosed that the Lagos Rail Mass Transit (LRMT) trains are included in the Federal Government’s free train ride initiative for the Christmas and New Year celebrations.

The LRMT, which currently includes the Phase 1 Blue Line Rail and the Phase 1 of the Red Line Rail, operates under the Lagos Metropolitan Area Transport Authority (LAMATA).

This announcement was made by Ben Iloanusi, the Acting Managing Director of the NRC, during an interview on NTA News TV on Friday, following the launch of the initiative earlier that day.

While Iloanusi stated that Phase 1 of both the Blue Line and Red Line Rail projects are part of the program, LAMATA has yet to confirm this inclusion.

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Iloanusi outlined the other routes benefiting from the scheme, which include the Lagos-Ibadan Train Service, Kaduna-Abuja Train Service, Warri-Itakpe Train Service, Port Harcourt-Aba Train Service, and the Bola Ahmed Tinubu Mass Transit in Lagos. Notably, little was previously known about the Bola Ahmed Tinubu Mass Transit service until this disclosure.

“Let me mention the routes where this free train service is happening. We have the Lagos-Ibadan Train Service, we have the Kaduna-Abuja Train Service, we have the Warri-Itakpe Train Service, we have the Lagos Rail Mass Transit trains, we have the Port Harcourt-Aba Train Service, and we have what we call the Bola Ahmed Tinubu Mass Transit, which is also in Lagos,” he stated.

Iloanusi provided operational updates, stating that passengers nationwide can access free tickets online or, for those unable to do so, at train stations where they will be profiled and validated.

He noted that passengers using NRC-managed services (excluding the Lagos Rail Mass Transit) should reserve tickets via the official website, www.nrc.gov.ng, with a valid ID required. He also advised travelers to plan, arrive on time, and bring valid identification.

Lagos Rail Mass Transit part of FG free train ride – NRC

Business

NNPC denies claim of Port Harcourt refinery shutdown

Published

21 hours ago

December 21, 2024

Trends Admin

Port Harcourt refinery

NNPC denies claim of Port Harcourt refinery shutdown

The Nigerian National Petroleum Company Limited (NNPCL) has denied claims in media reports that the newly refurbished Port Harcourt refinery has shut down.

The national oil company denied the claim in a press release issued by its Chief Corporate Communications Officer, Olufemi Soneye, on Saturday.

Soneye said the claim was false and urged Nigerians to disregard it. He stressed that the Port-Harcourt Refinery is fully operational.

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The statement read, “The attention of the Nigerian National Petroleum Company Limited (NNPC Ltd.) has been drawn to reports in a section of the media alleging that the Old Port Harcourt Refinery which was re-streamed two months ago has been shut down.

“We wish to clarify that such reports are totally false as the refinery is fully operational as verified a few days ago by former Group Managing Directors of NNPC.”

He noted that preparation for the day’s loading operation is currently ongoing, and added that claims of the shutdown are “figments of the imagination of those who want to create artificial scarcity and rip-off Nigerians.”

NNPC denies claim of Port Harcourt refinery shutdown

Business

CBN permits BDCs to buy up to $25,000 FX weekly from NFEM

Published

2 days ago

December 20, 2024

Trends Admin

CBN Governor, Olayemi Cardoso

CBN permits BDCs to buy up to $25,000 FX weekly from NFEM

The Central Bank of Nigeria (CBN) has granted Bureau de Change (BDC) operators temporary permission to purchase up to $25,000 weekly in foreign exchange (FX) from the Nigerian Foreign Exchange Market (NFEM).

This move, detailed in a circular dated December 19, 2024, is designed to meet seasonal retail demand for FX during the holiday period.

The circular was signed by T.G. Allu, on behalf of the Acting Director of the Trade and Exchange Department.

The arrangement will be in effect from December 19, 2024, to January 30, 2025.

Under the directive, BDCs may purchase FX from a single Authorized Dealer of their choice, provided they fully fund their accounts before accessing the market.

Transactions to occur at the prevailing NFEM rate

The transactions will occur at the prevailing NFEM rate, and BDCs are required to adhere to a maximum 1% spread when pricing FX for retail end-users.

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All transactions conducted under this scheme must be reported to the CBN’s Trade and Exchange Department.

The circular read in part:

“In order to meet expected seasonal demand for foreign exchange, the CBN is allowing a temporary access for all existing BDCs to the NFEM for the purchase of FX from Authorised Dealers, subject to a weekly cap of USD 25,000.00 (Twenty-five thousand dollars only).

This window will be open between December 19, 2024 to January 30, 2025.

“BDC operators can purchase FX under this arrangement from only one Authorized Dealer of their choice and will be required to fully fund their account before accessing the market at the prevailing NFEM rate. All transactions with BDCs should be reported to the Trade and Exchange department, and a maximum spread of 1% is allowed on the pricing offered by BDCs to retail end-users.”

The CBN assured the general public that PTA (Personal Travel Allowance) and BTA (Business Travel Allowance) remain available through banks for legitimate travel and business needs.”

These transactions are to be conducted at “market-determined exchange rates” within the NFEM framework.

This initiative reflects the CBN’s strategy to stabilize the FX market and manage seasonal surges in demand.