When I wanted to trade today, I saw naira has climbed to 1490 to a dollar in the exchange market. Will this continue or government are only doing market manipulation?
With what I am reading, analysts are predicting that dollar price will continue to increase but the price of what we are importing are not falling. Do you think increasing the value of naira while things are still expensive a good idea?
When our currency strengthens against the dollar you will understand that inflation is decreasing slightly but you will not understand its impact on the commodity market so quickly. Another reason for the strengthening of the Naira is the increase in reserves. If the government’s dollar reserves continue to increase, it can also increase the value of the currency in the country. Since goods have to be purchased from outside the country and paid for in dollars or some other currency there may be a shortage of dollars most of the time but if there are sufficient reserves, it is easy to pay the purchase price and keep the reserves intact. The issue of government manipulation may not be correct here.