Two capital market operators on Wednesday told the Central Bank of Nigeria (CBN) to tackle the disparity at the forex market.
They told the News Agency of Nigeria (NAN) in Lagos that the disparity could further weaken the bourse, due to sell pressure arising from profit-taking by speculators expecting currency devaluation.
NAN reports that the operators were reacting to the outcome of the Monetary Policy Committee meeting of the CBN on Jan. 26, which dashed the expectations of speculators on further devaluation of the naira.
Malam Garba Kurfi, the Managing Director of APT Securities and Funds Ltd., said the major problem of the nation’s currency was the black market.
Kurfi said that Nigeria needed to prioritise the dollar for essential things and not for luxury in line with present realities.
“We have to prioritise allocation of the few dollars we have for things that are essential to boost local production,” Kurfi said.
The Managing Director of Trust Yield Securities Ltd., Alhaji Rasheed Yussuf, said the devaluation of the naira would not benefit the economy because Nigeria was import-dependent.
Yussuf said the devaluation would benefit mainly foreigners, noting that Nigerians should patronise locally- produced goods to develop the manufacturing sector.
He said that devaluation would not benefit the country at the moment, adding that the government must be committed to economic diversification.
“We have no choice, we don’t have foreign exchange. Nigerians should start buying local goods such as cars and suits to grow the economy.”
He said the market would rebound with improved economic activities, adding that portfolio investors were the major cause of the downward trend.
On Jan. 26, the CBN at the MPC meeting retained the Monetary Policy Rate at 11 per cent.
It also fixed the Cash Reserve Ratio on public and private sector at 20 per cent.
Liquidity ratio was retained at 30 per cent while the net open foreign exchange trading position was retained at one per cent. (NAN)