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Nigerian Central Bank Told to Consider Floating the Naira, Recent Interest Rate Hike Slammed

The Central Bank of Nigeria should be discontinuing the fixed exchange rate system and let the naira freely float against the major currencies, Alhaji Aminu Gwadabe, the leader of a Nigerian association of bureau de change operators has said. The leader also slammed the recent adjustment of the central bank’s interest rate to 13%, which he said could have a negative impact on Nigeria’s underperforming economy.

Central Bank Told to Intervene to Save the Naira

The leader of a Nigerian association of bureau de change operators, Alhaji Aminu Gwadabe, has urged the country’s monetary authorities to consider allowing the local currency to freely float against the U.S. dollar. According to Gwadabe, doing this will help to prevent further depreciation of the naira.

In an interview with the News Agency of Nigeria, Gwadabe is also quoted advising the Central Bank of Nigeria (CBN) to consider intervening in foreign exchange markets. He reportedly said:

CBN should contemporaneously undertake a large-scale dollar intervention in the open market that can inspire confidence in the Naira and checkmate the current tailspin. Once there is a significant positive movement, the market will react and, in all probability, spur an avalanche of panic selling and further buoy the Naira.

Gwadabe also reportedly said the CBN could still make a profit through a buyback of the dollars on the open market.

The comments by Gwadabe, whose organization’s members were previously accused of fueling the naira’s freefall on parallel forex markets, followed recent reports of the naira’s plunge and the CBN’s subsequent call on Nigerians to stop using the greenback for speculative purposes. With the latest plunge, the naira’s parallel market exchange rate of slightly over N700 for every dollar versus the official exchange rate of N424 implies the currency may be overvalued by nearly 70%.

Cashing Out Remittances in Dollars Exerts Pressure on Naira

Meanwhile, the News Agency of Nigeria report also quotes Gwadabe questioning the CBN’s decision to adjust the monetary policy rate (MPR) to 13% per annum. According to Gwadabe, the adjustment is likely to have a negative impact on Nigeria’s underperforming economy.

“Increasing the MPR contracts the supply side, it is the wrong prescription. Let’s not copy the Americans who target inflation with FED rates to curb money supply; their factors of production have been fully mobilized, ours is at less than 20 per cent and requires stimulation of the supply side,” Gwadabe is quoted explaining.

Instead of hiking the rate, Gwadabe recommended cutting the rate to 5% which he said “looks more appropriate.”

Concerning the CBN’s decision to allow recipients of remittances to cash out in dollars, Gwadabe claimed this “fuels currency substitution.” Besides exerting more pressure on the exchange rate and inflation, this central bank policy “does not have a statutory backing unlike domiciliary accounts, therefore, it is illegal.”

Gwadabe also claimed that the solution to Nigeria’s currency woes “has to be psychological too” because the current “panic buying is driven more by psychology and less by economic fundamentals.”

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Hedera Hashgraph prediction as price reclaims the $0.074 level

Hedera Hashgraph is a smart contract platform that uses an algorithm for fast transactions HBAR has reclaimed the $0.074 level after 10% gains in the week HBAR could consolidate, but $0.074 remains the reference support Hedera Hashgraph HBAR/USD has surged by more than 10% in the past 7 days. The gains have propelled the token::Listen

Hedera HBAR Coin Logo

  • Hedera Hashgraph is a smart contract platform that uses an algorithm for fast transactions

  • HBAR has reclaimed the $0.074 level after 10% gains in the week

  • HBAR could consolidate, but $0.074 remains the reference support

Hedera Hashgraph HBAR/USD has surged by more than 10% in the past 7 days. The gains have propelled the token to higher levels, reclaiming a major resistance. If trading HBAR, it is important to watch key levels where the price may face indecision.

Hedera Hashgraph is a blockchain that promises to deliver secure and fast transactions. The blockchain aims to achieve the objective through a distributed consensus algorithm. Hedera also seeks to enable anyone to deploy applications on the platform for true decentralization.

Hedera Hashgraph may not be the strongest cryptocurrency this year. Since bottoming at $0.06 in mid-July, it has been making very slow gains. That is despite most other cryptocurrencies staging strong recoveries. Nonetheless, recent recoveries may be a tip of what is about to come for the token.

Hedera Hashgraph begins recovery, but momentum is weak

Source – TradingView

From the daily chart outlook, the 21-day and 50-day moving averages have joined a support for HBAR. The 21-day MA has closed above the 50-day MA as bullish momentum builds. The MACD indicator also points to building momentum. The price is well supported above $0.074, suggesting that HBAR has set new reference support. The token is moving along an uptrend.

Concluding thoughts

If considering buying HBAR, the $0.074 should be the reference level. Nonetheless, with the weak momentum, the token could continue to consolidate. Consequently, HBAR is not the best token for short-term buyers. Dip and long-term buying are recommended.

If HBAR keeps $0.074 intact, the next levels to watch are $0.10 and $0.15. The cryptocurrency could also face some resistance at $0.09.

The post Hedera Hashgraph prediction as price reclaims the $0.074 level appeared first on CoinJournal.

Nigerian Central Bank Told to Consider Floating the Naira, Recent Interest Rate Hike Slammed

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