2022 Reports show Nigeria’s external reserves fell by 3.6% in August, to $39.024 billion, down from $40.520 billion on December 31, 2021.
Pressure on the Nigerian foreign exchange reserves has forced it to lose a whopping $1.496 billion Year to date, despite the rush in crude oil prices.
Despite the apex bank’s interventions in the forex market, the Nigerian economy is starved of foreign exchange as currency traders continue to complain about restricted forex liquidity, causing the local currency to depreciate more in the FX market.
Although there are a number of CBN policies and programs aimed at encouraging inflows, Nigeria’s inability to attract foreign currencies through export value, diaspora remittances, and investments has resulted in a severe FX shortage in the country, encouraging arbitrage in the parallel market.
The decline in foreign reserves comes amidst over $100 crude oil average price in August against a benchmark of $62 per barrel set by the Federal Government for the N17.12trillion 2022 budget.
Nigeria’s foreign exchange reserves are mostly reliant on the income from the export of crude oil, however, despite the rise in oil prices, Nigeria’s capacity to increase its oil revenues has been constrained by decreasing oil production.
The Nigerian exchange rate between the naira and the US dollar has massively declined from N565/$1 to N700/$1, representing an N135 differential year to date. On the other hand, the official exchange rate has maintained stability to trade around N430/$ at the time of writing this article.
However, the stability of the official exchange rate comes at a cost to the reserves as the Central bank sells foreign exchange in the official window from its external reserves. The reserve decline can be linked to CBN’s ongoing intervention in the official FX market to limit exchange rate volatility.
Furthermore, the bank’s ability to stabilize the Naira will be hampered if the pressure continues since Nigeria’s foreign reserves are being depleted.
Usain Bolt Gets Duped Of $12 Million Savings
Usain Bolt, the Olympic sprinting champion from Jamaica, lost millions of dollars in his account with Kingston-based Stocks and Securities Ltd.
The legal team for the racing star stated they are prepared to launch a lawsuit if doing so would allow them to recoup the $12 million that inexplicably vanished from Bolt’s account.
According to a statement made by Bolt’s attorneys, there is reportedly just $12,000 still in Usain Bolt’s account.
“The account was part of Bolt’s retirement and lifetime savings,” his lawyer, Linton P. Gordon, told Fortune magazine over the phone. It’s distressing news for anyone, and certainly in the case of Mr Bolt, who established this account as part of his private pension,” Gordon said on Wednesday.
“We will be going to court with the matter” if the company does not return the funds, Gordon said. It is a grave disappointment, and we are hoping that the matter will be resolved in a way that Mr Bolt will recover his money and be able to live in peace.”
The business’ response was: Stocks & Securities Ltd. stated in a statement on January 12 that it had informed law authorities of the fraudulent activities by a former employee.
It said that it has tightened standards and taken steps to safeguard consumers’ assets.
The “alleged fraudulent operations at SSL that are reported to have affected the accounts of Mr. Usain Bolt and other persons” are being investigated, according to a second statement made on Monday by the Jamaica Constabulary Force.
The Jamaican government participates: Nigel Clarke, the finance minister for Jamaica, asserted SSL had perpetrated “alarming and vile fraud” on Tuesday night and vowed to “bring all perpetrators to account.”
According to the Associated Press, Mr. Bolt’s account with the business was established as a pension for both of his parents as well as the eight-time Olympic gold medalist sprinter.
After dominating the sprinting world for a decade, reviving a sport ravaged by drug scandals, and becoming as well-known as Muhammad Ali, Bolt announced his retirement in 2017.
Bitcoin Trades Higher Than Meta and MasterCard In Value
With a gain of almost 25% over the previous two weeks of 2023, Bitcoin began the New Year on a positive note and was trading above $21,000, trading higher than MasterCard and Meta in value.
Additionally, Bitcoin is now more valuable than brands like MasterCard and Meta, with a market worth of over $400 billion.
By market capitalization, the biggest cryptocurrency has maintained a price above $21,000, which is a level it has not traded since November 2022.
Prior to a flurry of encouraging economic news, notably a drop in the U.S. Consumer Price Index (CPI), which finally sent cryptocurrency and stock prices northward, Bitcoin was trading below $17,000.
A psychological price ceiling of $20,000 and BTC’s 20-week exponential moving average (20-week EMA; the green wave) at $19,500 formed a resistance confluence that was broken by the price increase.
Strong volume breaking three resistance levels demonstrates traders’ confidence in a prolonged market advance. Should it occur, Bitcoin’s next upward objective is at its 200-week EMA (the yellow wave), which is roughly $25,000. This represents a 20% increase over the current price.
Dollar cross of doom The U.S. dollar is down due to anticipation that the Federal Reserve would cease rising interest rates as a result of decreased inflation, which contrasts with Bitcoin’s bullish technical outlook.
Since March 2020, the two assets have usually moved in opposition to one another. According to TradingView, as of January 16, there was a -0.83 daily correlation coefficient between Bitcoin and the U.S. Dollar Index (DXY), a measure of how strong the dollar is relative to its main rivals.
In an email, Bradley Duke, co-CEO of cryptocurrency ETP provider ETC Group, claimed that positive economic data in the US, including lower inflation statistics and strong job growth numbers, as well as positive economic data in Europe in which the EU released unemployment stats that were the lowest in 23 years.
The BTC future market echoed this shift in mood, with traders placing long bets four days in a row based on the Long-Short ratio.
Head of research at the Canadian digital asset management 3iQ, Mark Connors, explained:
“Looming large in our three-part thesis on digital asset adoption is the juxtaposition of a growing U.S. debt load set against a declining workforce that is ‘ageing out. If we don’t let inflation cut our debt in real terms and we cannot grow out of it, expect more of it.” He further added, “BTC is more correlated to debasement than inflation, so not surprised to see BTC lift with the prospects of more debt.”
Despite Bitcoin’s 30% increase above $20,000 so far in 2023, on-chain data reveals that institutional investors are not supporting the purchasing trend.
For instance, according to CryptoQuant’s Fund Holdings index, the total quantity of Bitcoin owned by holdings of digital assets such trusts, exchange-traded funds, and other funds has been decreasing amid the coin’s price surge in recent months.
According to comparisons between CryptoQuant’s Token Transferred and Fund Flow Ratio measures, no noteworthy transactions happened on-chain but rather on cryptocurrency exchanges, suggesting that this is solely a retail rally.
Other significant cryptocurrencies were up earlier this week, with CRO, the token of exchange Crypto.com, gaining by more than 7%. SOL, the Solana blockchain’s native coin, increased by more than 1.4% to maintain its recent upward trend. In addition to its recent improbable gains, FTT, the token of troubled cryptocurrency exchange FTX, increased by more than 24% at one time.
Over the weekend, the total value of the cryptocurrency market reached $1 trillion, and since Friday, there have been more than $500 million in short liquidations—bets against rising prices—making this the largest amount since November 2022.
The Crypto Fear & Greed Index has reached 45, remaining in the fear zone. But compared to June, this is perhaps six times more.
2023: Millions Of Nigerians In Danger Of Hunger—UN
World-leading union, UN has risen to warn to the Nigerian government on a projected forecast of hunger in the country in the months of June and August.
In order to avoid 25 million Nigerians from being hungry this year, the UN cautioned that immediate measures must be done.
The United Nations issued a warning that 25 million Nigerians face a starvation risk between June and August of this year and urged immediate action to avert this.
This information was revealed by the UN Associate Spokesperson, Ms. Stephanie Tremblay, on Monday in New York, according to NAN.
The UN asked both public and private partners to commit funds to address the nation’s food insecurity.
According to NAN, Ms. Stephanie Tremblay cautioned that in order to keep 25 million Nigerians from becoming hungry this year, immediate measures must be adopted. Tremblay stated:
“Nearly 25 million Nigerians are at risk of hunger between June and August this year if urgent action is not taken.
“This is according to the October 2022 – Cadre Harmonisé, a food, and nutrition analysis led by the government of Nigeria, in partnership with the Food and Agriculture Organisation, UNICEF, and the World Food Programme”.
Conflict, inflation, and climate change were all mentioned by Tremblay as the main factors influencing the danger of hunger.
From the report:
Continued conflict, climate change, inflation, and rising food prices were the key drivers of this alarming trend, noting that children were the most vulnerable to food insecurity.
Over 400,000 hectares of cropland were destroyed by statewide floods in Nigeria last year, which caused a surge in the country’s food inflation rate, which increased to 23.72% on an annual basis by October 2022.
While insecurity contributed to the failure of the agricultural sector last year, the lack of proper investment could become a huge detriment this year for Nigerians.
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