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Naira may hit 500 per dollar – Governor Willie Obiano

Obiano said that naira will continue to fall against dollar till it reach N500 to Dollar; just as FG raised N121b in an auction of local-currency bonds

*As FG borrow N183.24b via Treasury bills

The Anambra State Governor, Chief Willie Obiano, has said that the naira will continue to fall against the dollar till it reach N500 to the greenback.

Obiano said this during the commencement of the Anambra State Fire and Safety Summit in Awka on Wednesday.

The governor, who expressed fear that the dollar would continue to rise against the naira, said it would take no fewer than 18 months for the economic downturn in the country to subside.

He said, “People should embrace risk management. That is the solution to disaster, especially in a recession.

“No recession lasts less than 18 months, so we need to wake up. The naira is moving to N500 per dollar.

“We need to secure our certificates and other valuables of ours so that nothing will happen to them overnight. That’s the way to survive in a recession.”

Relatedly, in a recent data from Debt Management Office [DMO] on Thursday, the Federal Government borrowed N183.24 billion via Treasury bills at an auction, with mixed yields on all the tenors.

The DMO raised N48.10 billion of three-month paper at 14 per cent, down from 14.38 per cent it sold at an auction on August 31.

It also sold N48.45 billion worth of the six-month paper at 17.77 per cent, higher than 17.50 per cent previously.

A total of N86.69 billion was sold in the one-year debt at 18.48 per cent against 18.42 per cent at the last auction.

The DMO had last Tuesday said the government would borrow N120 billion ($387 million) in local-currency denominated bonds at an auction on September 14.

The debt office said it would raise N40 billion each from debt maturing in 2021, 2026 and 2036, using the Dutch auction system.

All the bonds were re-openings of previously issued debt.

The Federal Government has estimated it will borrow around N900 billion from the local debt market this year to fund a budget deficit projected at N2.2 trillion.

The Central Bank of Nigeria has said it is planning to borrow N1.77 billion via Treasury Bills in the last three months of the year.

In its fourth quarter Treasury bill issue programme released last Monday, the CBN said it would raise about N815.37 billion , comprising 91 days, 182 days and 364 days debt instruments

In addition to the above, the central bank was also planning to raise about N952.05 billion as rollover in the three categories of the instruments.

This followed improved naira cash liquidity after the disbursal of July budgetary allocations to Federal Government agencies.

The Federal Government distributes revenues from crude exports and taxes among the three tiers of government every month.

At the CBN’s Monetary Policy Committee meeting in July, the central bank raised its benchmark interest rate (Monetary Policy Rate) to 14 per cent in a bid to tighten liquidity.

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