Business

Naira stays strong as Pound leaps against rivals

Published

7 years ago

May 14, 2018

Olu Emmanuel

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The Nigerian Naira on Monday, May 14, retained its strengthened rate at the parallel market against Dollar.

The Naira closed at N363 to a Dollar, N430 to Euro while the Pound traded at N500

National Daily gathered that the local currency maintained the same rates of N363 against Dollar, N500 to £1 and N430 against Euro as it was on Friday, May 11.

Meanwhile, the British Sterling at the weekend headed for its fourth successive weekly decline versus the dollar, in what would be a first for the currency since 2015, after the Bank of England held rates and cut its economic growth projections.

The pound fell sharply after the BoE on Thursday held interest rates steady as expected but cut its growth and inflation projections for this year and next.

The decision bred skepticism among investors over whether the central bank would hike rates at all this year after weeks of declines caused by weaker-than-expected economic data that was partly blamed on bad weather.

Sterling has tumbled to $1.35 in recent weeks from its post-Brexit vote highs of close to $1.44 and erased its gains against the dollar for the year.

The pound recovered somewhat on Thursday after Bank of England Governor Mark Carney told the BBC that he expected a rate rise over the course of the next year if there were no shocks to the economy.

On Friday the currency rose 0.1 percent versus the dollar at $1.3533 and increased 0.1 percent against the euro at 88.090 pence.

Some analysts criticised Mark Carney for the decision to hold rates and for a month earlier making comments that the market perceived as a signal for a near-certain May rate hike.

Carney told reporters on Thursday the bank’s earlier guidance on tighter policy had been conditioned on February inflation projections but the economy had not fulfilled those conditions.

But other analysts said that doubts over the BoE’s message would fade, especially if data in the next months showed the British economy gaining momentum, Reuters reports.