•ASI drops 0.18% on Tinubu’s victory at S’Court
From Omodele Adigun, Uche usim (Abuja), and Chinwendu Obienyi
Naira slumped to an all-time low on Thursday, trading at N1,316 to a dollar at the parallel market.
The figure, described as a deadly economic blow by importers and players in the Small and Medium Enterprises space, represents a depreciation of N91 or 7.35 percent compared to the N1,225 it was on Monday. In Abuja, Bureau De Change operators (BDCs), sold dollars at N1,316 and bought N1,299 N17.
Experts blamed the tumbling naira on dollar scarcity as speculators and genuine dollar seekers beseech the parallel market in search of it.
Data from FMDQ Securities Exchange — a platform that oversees official FX trading in Nigeria revealed that naira appreciated by 5.51 percent, from N847.77/$ on Tuesday, to close at N801.10/$ on Wednesday. A total of $100.18 million was traded at the investors’ and exporters’ window (I&E) window — Nigeria’s official trading market.
Since the Central Bank of Nigeria (CBN) announced the floating of the naira, the local currency has continued to depreciate as it tries to find its real value. The gap between the official and parallel markets has been widening.
Consequently, the prices of goods, especially imported foodstuff, have reached stratospheric heights.
This is threatening many surviving businesses as many have already packed up.
Meanwhile, following the Supreme Court ruling uphold ing President Bola Tinubu’s election win, the nation’s financial market continued to react negatively sending jitters to players across industries.
Hours after the S’Court’s ruling, markets reacted negatively with the Naira at the parallel market closing at N1,316/$1 from an opening figure of N1,255 while it depreciated by 4.3 per cent to N837.49/$1 from N801.10/$1 at the Nigerian Autonomous Foreign Exchange Market (NAFEM). Furthermore, bearish sentiments pervaded trading at the Nigerian Exchange Limited (NGX) as the NGX All-Share Index succumbed to a second successive loss, falling 0.18 per cent to close at 67,084.95 points.
Specifically, selloffs in MTNN (-0.40 per cent), Zenith Bank (-0.75 per cent), and GTCO (-1.55 per cent) dragged the overall market offsetting gains in Nestle (+2.94 per cent), UBA (+0.27 per cent), and Accesscorp (+0.59 per cent). However, the market remained on track for a week of gain, but the year-to-date (YTD) return slipped to 30.89 per cent, while the market capitalisation contracted by N66.59 billion to close at N36.86 trillion.
Proceedings in the NTB secondary market were bearish, as the average yield expanded by 9 basis points (bps) to 7.1 per cent. Across the curve, the average yield advanced at the short (+28bps) and long (+6bps) ends following selling pressures on the 91DTM (+112bps) and 322DTM (+80bps) bills, respectively; but closed flat at the mid segment. Elsewhere, the average yield was unchanged at 12.0 per cent in the OMO segment.
Similarly, proceedings in the FGN bond secondary market were bearish, as the average yield expanded by 17bps to 14.6 per cent. Across the benchmark curve, the average yield expanded at the short (+38bps) and long (+14bps) ends as market participants sold off the MAR-2027 (+76bps) and MAR-2050 (+50bps) bonds, respectively. Conversely, the average yield was flat at the mid segment.
It appears that the confidence which was strong a few months ago, is now on a gradual decline on the back of the country currently grappling with double-digit inflation, foreign currency shortages, a weakening naira, widespread insecurity and crude oil theft.
Expressing their concerns on the current state of the economy, economic experts who spoke during a forum monitored by Daily Sun, have called on Tinubu to adopt a more citizen-oriented style of governance for the economic development and prosperity of Nigeria.
Former Vice President, World Bank (Africa Region), Oby Ezekwesili, urged the President to give the masses who constitute the larger population of the society central position in his economic policies.
Speaking at Nnamdi Azikiwe University, Awka, during the 5th International Hybrid Conference of the Unizik Business School (UBS), the former Education Minister regretted that Africa’s pattern of political transition had not guaranteed true democracy.
Describing real democracy as one that generates positive socio economic development, Ezekwesili said that “Nigeria’s political system has become a system where the transition is no longer people but court driven and monopolized such that the people’s wishes do not count anymore but the wishes of the political class”.
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