Inflation soars, Naira dives, CBN Governor talks...   

May 22 (Lagos) - Inflation rose to 12.34% in March, its highest level in 2 years. The food sub-index rose to 15.03%. Nigeria devalued its currency once again last month when the crude oil price crash proved to be the final straw. 

Food prices have risen sharply since the lock down began. 

The Naira (NDF) forwards for five years predict that the Naira will hit 528 against the US Dollar. In the parallel market the Naira is already 450. 

The CBN Governor made a clarion call to business owners to refrain from buying Dollars from the parallel market and warned them that they could end of losing money. This was a direct message from CBN Governor to business owners over the internet. 

Nigeria has a system where anyone can go and buy USD from the street hawkers who get their supply from BDC's and other mysterious sources. Someone can go with N 10,000 and convert it to Dollars at a street market. Wait for Naira to weaken further and sell for a quick profit. All this can go on because there is no regulation or it only exists in the books. 

And with all the devaluation gurus advising people to buy dollars at any cost broadcasting their messages on social media, one can understand how someone can be convinced to buy based on peer pressure, social media discussions etc. 

Can you blame them after they got barred from earning just enough to keep up with inflation by investing in T-bills? CBN Governor should answer. 

CBN Governor took a 100% positive step in giving his message to business community and public at large. Policies like stopping Nigerians to invest in Treasury-bills could have also pushed people to invest in Dollars. CBN needs to explain such policies which discourage Nigerians from lending to the Federal Government. No one was there on the live conference of the Governor to ask these questions. 

In middle of all this, the economy is once again going for a toss. People are fed up with the lack of progress in various sectors or slow pace of decision making. No one investing in Nigerian stocks would have believed you if you told them 2020 will be worse than 2019. 

We need to catch a ray of hope, there is light at the end of this long tunnel. 

CBN should roll out Policies that give us a chance to survive but just letting us keep up with inflation since they cannot control inflation. 

reporting for on Thursday, May 22 2020 from Lagos, Nigeria
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