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Naira Situation Worsens, Falls To N270/$
By GclefAmplified Dec 18, 2015
*CBN blames currency’s plunge on speculatorshttp://www.thisdaylive.com/articles/us-fed-rate-hike-worsens-naira-situation-falls-to-n270-/228226/
*Ministry, MDAs conclude meetings on 2016 budget
After a two-day meeting, the Federal Open Market Committee (FOMC) of the US Federal Reserve Bank raised its benchmark interest rate by 25 basis points to 0.25 per cent to 0.50 per cent, a move certain to put more pressure on the naira, which on Wednesday plunged to a new low at the retail segment of the foreign exchange market to N270 to the US dollar.
Speaking on the first rate hike in almost a decade, the US Fed Chairman, Janet Yellen, said that the increase was a vote of confidence in the US economy, but stressed that the pace of interest rate hikes would be gradual.
But whilst US markets may have hailed the decision and saw the Dow Jones, S&P 500 and Nasdaq initially falter, but later rallied to news on the rate hike, the same could not be said of the Nigerian economy and the local currency, which have been hit by dwindling revenue from low oil prices.
Oil revenue accounts for 90 per cent of Nigeria’s foreign exchange and 70 per cent of total revenue.
Low oil prices and forex currency curbs introduced by the Central Bank of Nigeria (CBN) saw the naira fall yesterday to a new low of N270 to the dollar on the unofficial market after the central bank rationed dollar supplies for the third week in a row, traders said.