Naira To Crash Further In January At The Parallel Market – CBN

With barely 3-more days to the end of the year 2020, the Central Bank of Nigeria {CBN} has announced that business owners should brace up as the Naira is set to further crash at the parallel market. Naira to Dollar

Also according to the Statistics Department, the Naira is expected to depreciate further in January 2021.
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The report, titled, ‘December 2020 Business Expectations Survey Report’ added that there might also be a steady rise in the interest rate from December till the next six months.

The naira witnessed a sharp fall in recent weeks, reaching its lowest on November 30, 2020, when it exchanged for N500/$1. Since then, the dollar has been hovering between N460 and N470. As of Friday, however, one dollar exchanged for 465  in the parallel market.

The report partly read, “Respondent firms expect the naira to depreciate in the current month and next month but appreciate in the next two months and the next six months.

“Inflation level is expected to rise in the next six and 12 months as firms expect the average inflation rate in the next six months and the next 12 months to stand at 13.24 and 14.51 per cent, while the borrowing rate is expected to rise in the current month, next month, next two months and the next six months with indices of 19.2, 14.9, 14.7 and 14.3 points.”

The CBN stated that respondent firms identified insufficient power supply, unfavourable economic climate, competition, high-interest rates, unclear economic laws, financial problems, unfavourable political climate, access to credit, insufficient demand, lack of equipment, lack of materials input, and labour problems as major factors constraining business activities in December 2020.

Photo Credit: Getty

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