CBN may further devalue naira after elections

 

The Central Bank of Nigeria’s Monetary Policy Committee might be forced to devalue the naira again after the general elections scheduled to hold in February, it was learnt on Monday.

The indication to this effect is coming less than two months after the MPC devalued the currency on November 25 from 155 to 168 to the United States dollar.

Sources said the proposed devaluation was because the currency was already trading at the interbank market below the 160-176 target band set by the CBN.

They said it was necessary to devalue the naira again in order to prevent further pressure on the currency and arrest subsequent depreciation of its value.

It was learnt that the fresh devaluation was meant to be carried out during the next meeting of the MPC, which is scheduled to hold later this month, but it was postponed till after the elections in February for political considerations.

This came just as industry analysts predicted that the naira, which currently sells between 191 and 193 against the dollar at the parallel market, would likely exchange for over 220 soon.

According to experts, the naira has remained under continued pressure owing to the continued fall in the prices of crude oil in the international market and increased demand for the dollar locally.

The development, they said, would lead to a number of economic challenges this year. ...BusinessNews