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• Nigerian Naira Report FY 2011

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  Deitric Muhammad    Group moderator

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  Nigerian Naira Report FY 2011

  Report Completed: 03 September 2011
  
  
  In the Name of Allah the Beneficent the Merciful
  
  
  Topic: Currency Report 2011
  
  Currency: Nigerian Naira
  
  
  Central Bank Monetary Policy: They have raised their Monetary Policy Rate (MPR)--the nation's key rate to 6.25% and they have adjusted the Standard Lending Facility (SLF) rate to 8.25% and the Standard Deposit Facility (SDF) rate to 4.25%. The central bank is prepared to—but as of yet has not—added liquidity for credit facilitation purposes.
  
  See more at: http://www.cenbank.org/monetaryPolicy/decisions.asp
  
  Exchange Rate (@US $1.00): 154.779 (01 Sept 2011)
  
  
  Predictive Analysis: The Nigerian naira is experiencing inflationary pressure, but the naira is in a better position than the euro and the US dollar because the Nigerian central bank has raised their key interest rate to slow down the rate of inflation in order to help preserve the purchasing power of the naira. This will help stabilize the naira which will help stabilize prices. Capital inflows from external economies will increase economic activity and the increase of domestic businesses will also increase economic activity. This will enable the gross domestic product to support the naira during this inflationary period. However, that support is limited due to the naira's pegged position to the US dollar and its dependency on the British commonwealth—which is supported by the euro. Nevertheless, the naira is in a stronger position than its US and European counterparts, and we expect stronger and more stable market activity throughout 2011-2012 than the euro and the US dollar. However, we recommend the central bank does not add liquidity, but to reduce it in order to bring down prices and to effectively facilitate credit concerns. This would make more sense than to exacerbate current economic conditions by adding liquidity in an inflationary period. The Nigerian central bank's restraint is most applaudable.
  
  • 13 Sep 2011, 5:52 pm
  Deitric Muhammad wrote: > Report Completed: 03 September 2011 > > > In the Name of Allah the Beneficent the Merciful > > > Topic: Currency Report 2011 > > Currency: Nigerian Naira > > > Central Bank Monetary Policy: They have raised their Monetary Policy > Rate (MPR)--the nation's key rate to 6.25% and they have adjusted the > Standard Lending Facility (SLF) rate to 8.25% and the Standard > Deposit Facility (SDF) rate to 4.25%. The central bank is prepared > to—but as of yet has not—added liquidity for credit facilitation > purposes. > > See more at: http://www.cenbank.org/monetaryPolicy/decisions.asp > > Exchange Rate (@US $1.00): 154.779 (01 Sept 2011) > > > Predictive Analysis: The Nigerian naira is experiencing inflationary > pressure, but the naira is in a better position than the euro and the > US dollar because the Nigerian central bank has raised their key > interest rate to slow down the rate of inflation in order to help > preserve the purchasing power of the naira. This will help stabilize > the naira which will help stabilize prices. Capital inflows from > external economies will increase economic activity and the increase > of domestic businesses will also increase economic activity. This > will enable the gross domestic product to support the naira during > this inflationary period. However, that support is limited due to > the naira's pegged position to the US dollar and its dependency on > the British commonwealth—which is supported by the euro. > Nevertheless, the naira is in a stronger position than its US and > European counterparts, and we expect stronger and more stable market > activity throughout 2011-2012 than the euro and the US dollar. > However, we recommend the central bank does not add liquidity, but to > reduce it in order to bring down prices and to effectively facilitate > credit concerns. This would make more sense than to exacerbate > current economic conditions by adding liquidity in an inflationary > period. The Nigerian central bank's restraint is most applaudable.