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Nairaland Forum / Nairaland / General / Investment / Devaluation Of Naira: Effect On Foreign Exchange (1258 Views)
Protection For Investors Against Devaluation Of Naira / Re: New Forex Policy - Depreciation, Not Devaluation? (2) (3) (4)
Devaluation Of Naira: Effect On Foreign Exchange by journerman(m): 9:19am On May 14, 2016 |
I've got a question for the economist and investment bankers in the house. As reported in the news recently, there's indication that Nigeria Government cum CBN might devalue the Naira based on IMF recommendation. I'll like to know the effect(s) of this on foreign exchange. In a lay man terms, Could it be safer now to have money converted to dollars/pounds and then back to Naira after devaluation or leave it as it is in Naira. Can we have some intelligent analysis of this subject please. Cheers! |
Re: Devaluation Of Naira: Effect On Foreign Exchange by unipol(m): 11:50am On May 14, 2016 |
Reserve for coment |
Re: Devaluation Of Naira: Effect On Foreign Exchange by unipol(m): 11:50am On May 14, 2016 |
Book for explanation. |
Re: Devaluation Of Naira: Effect On Foreign Exchange by Coolcash1: 11:51am On May 14, 2016 |
Devaluation can go either way. In the short term speculation on dollar will fall but rise in long term where no increased fdi and weak industrialization |
Re: Devaluation Of Naira: Effect On Foreign Exchange by Naijainvestor: 8:21pm On May 15, 2016 |
journerman: If your aim is to secure the Naira value, it pays to buy dollar now and sell it back after the devaluation subject to any charges involved in the buying and selling. If there no charges, it will pay to buy dollars That is one of the problems in the Nigerian financial system, there is no instruments for forex management like fx swaps, fx options, forward contracts. There are no financial engineers in Nigeria and the legislation is too slow 1 Like 1 Share |
Re: Devaluation Of Naira: Effect On Foreign Exchange by donsteady(m): 5:26am On May 16, 2016 |
From a lay man point of view, it would make sense if you buy $$ and sell after devaluation. But how sure are we that naira will be devalued? 1 Like |
Re: Devaluation Of Naira: Effect On Foreign Exchange by Naijainvestor: 6:30pm On May 16, 2016 |
donsteady: Even if Naira is not officially devalued, it gets depreciated/devalued slowly by the forces of demand and supply, as long as the demand for the dollar continues to increase relative to decreasing oil price, foreign reserves and foreign direct investment, you will be better off buying dollar now |
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