…Says it would fuel Speculative attacks on Naira ***
Prof. Sheriffdeen Tella, Professor of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun has described Naira devaluation by the Central Bank of Nigeria as unfortunate, noting that the gesture would further encourage speculative attack on the Naira.
“The pressure in the foreign exchange market we have witnessed in the last few weeks was not caused by demand for foreign currency to buy inputs for production”, the don said on Sunday.
“It’s from people who are trying to hold foreign currency either for speculative purpose for possible travels or to lodge same in their foreign accounts where BVN is not available to reveal their identities.
“So, devaluing the currency will encourage further speculative attack on the naira.
“Haven emptied the sovereign wealth fund (SWF) account and Excess crude account, the CBN should not have taken this panic measure now that the recession has not taken root in the economy.
“It was a wrong move that was not based on the causal factor of the foreign currency demand pressure,” Tella said.
It would be noted that the apex bank on March 20 collapsed the multiple exchange rate policy that determined the value of the naira and adopted a single exchange rate.
This shows that the country would now have a uniform rate for the official rate, bureau de change operators, importers and exporters amongst others.
This, was according to a circular signed by the CBN Director, Trade and Exchange Department, Ozoemena Nnaji, on the disbursement of the proceeds of the International Money Transfer Operator (IMTO).
It said International Money Transfer Service Operators to banks would be at N376 per dollar.
Banks to CBN would be N377 per dollar, CBN to Bureau de Change (BDC) N378 per dollar, BBC to end-users should not be more than N380 per dollar and the volume of sale to each market is 20,000 dollars per BDC.