By Adebisi Ademola.
The naira on Wednesday appreciated against the dollar at the interbank market.
The currency gained 0.84 points to exchange at N309.83 to the dollar, from N310.67 it exchanged on Tuesday, representing an appreciation of 0.27per cent.
It, however, stabilised at the parallel market, exchanging at N425 to the dollar, a figure it had maintained for three days, while it traded against the Pound Sterling and Euro at N550 and N468 respectively.
Currency traders attributed the relative stability to Monetary Policy Committee’s (MPC) Central Bank of Nigeria (CBN) status quo on interest rate and Cash Reserve Requirement (CRR).
However, a group of analysts at Meristem securities limited expressed that, “The MPC came to this conclusion by highlighting that the fight for lower inflation and boost in economic growth requires not only the efforts of the monetary policy but significant restructuring of the economy.
“The Committee also noted that from the last MPC meeting to date there has been sizeable foreign funds inflows, signifying a kickstart of the considerations reached at the prior meeting.
“Other considerations were the current fragile global and domestic macroeconomic conditions and outlook for the remainder of the year.
“Bearing in mind the decision arrived at by the MPC, we forestall yields to hover around the current levels in the short to medium-term.
“Also, we expect that given the prior direction of investors towards the fixed income market, the equities market may remain pressured. Furthermore, we expect that the prevalent high lending rate might still discourage loan writing as banks increase participation in the fixed income market,” they added.
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