12/11/ · Lordstown Motors Corp (NASDAQ: RIDE) tanked in the after-hours trading on Thursday. Riding High, Riding Low: The struggling electric vehicle startup's stock soared nearly 24% to This is because I am using an 5 Digits Broker. Because the EA will not automatically recognize a 4 or 5 Digits broker, we have to add a function which does this for him. But you will learn this later (in the next MQL4 tutorial). For now, leave it like this. (If you have a 4 Digits Broker, divide these 3 values by 10) 27/09/ · For example AUD/JPY at (4)7. (4) represents a pip. The last digit represents a pipette (7) Similarly, pairs quoted in 5 decimal points, a pip is on the fourth decimal. In a EUR/USD at (4)4. It is represented in a bundle of by Forex brokers
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Past governments in Nigeria have sought to respond to the country's balance of payments challenge by creating a legal parallel or dual foreign exchange market to avoid the short-term effects of a depreciation of the Naira on domestic prices while retaining some degree of control over capital outflows and international reserves.
However, as the situation turns in the wrong direction, the government begins to trade blames on the market players, forex 4 digit brokers. In Januarythe Central Bank of Nigeria CBN cut sales of FX to BDC operators and revised their operational guidelines for similar reasons stated as in the last two MPC meetings.
On March 24,the CBN also suspended the sales of FX to BDC operators to avoid excess liquidity in the system due to a reduction in travels and demand for foreign exchange by travellers at the peak of the COVID pandemic. The two instances were transitory as the CBN soon returned to the status quo. Nonetheless, forex 4 digit brokers, these instances show the CBN has long been in the business of chasing the symptoms instead of the causes.
Given the consistent depreciation of the naira against major foreign currencies forex 4 digit brokers and its recent sharp decline, the CBN essentially trailed the same route as was done in previous instances with the BDC operators and as the FGN did when its clampdown on telephone business centres during the 80s and 90s when there were shortages of telephone lines in Nigeria. The CBN is currently hunting the channels, speculators, and platforms rather than the root cause, forex 4 digit brokers.
My fear however is that what started as an FX Conundrum has morphed into a currency crisis that could lead into a financial crisis; if remedial measures and forward looking strategies are adopted. We have quite a lot of empirical evidences to back this up and the Asian financial crisis comes to mind.
Sadly, from what we saw from the most recent CBN press conference, their actions continues to accelerate and hurtle us towards the blowout point. It's almost like a death wish on their parts.
The higher rate of decline will attract more sellers and the the rate of decline accelerates even more and goes through the roof.
So, what then shall we do? Much as we would love to do something, forex 4 digit brokers, my personal take is that the macro forces are now in play and there's very little individual forces can do, forex 4 digit brokers, except for those individuals still with some semblance of "power" - whatever hue that may take. The tsunami will now move towards other nodes of forex 4 digit brokers system and they too will be overwhelmed one after the other.
Sadly, our worst fears may be about to be ealized. I pray I am off-target with theses probable model outcomes. So, lets take a forex 4 digit brokers at the arguments from actors.
The CBN Argument. On July 27,the CBN argued that gross external reserves have remained strong even though there was a decline from It observed that the naira exchange rate has only depreciated marginally by 0. The depreciation, according to the CBN, was driven mainly by the rising dollar demand from both genuine commodity importers and illegal hoarders using the Bureau De Change BDC and parallel market windows.
Such activities often overwhelm the supply of dollars CBN Communique Thus, given that the naira may remain under pressure in the medium term as the global economy reopen and the illegal activities of the unofficial windows continue, the CBN Governor, Godwin Emefiele, stated that the CBN would discount the sales of FX to the BDC, and would also no longer approve BDC license applications Proshare Research, According to the CBN, the apex bank has been having running battles with the BDC operators who were unwilling to yield to the rule of the game.
The bank also noted that the BDCs have consistently frustrated its effort and policy to strengthen the naira against the dollar. With the CBN's decision to discontinue weekly FX sales to BDC operators, it expected more stability and transparency in the FX market.
The CBN advised commercial banks to sustain the implementation of policy measures aimed at sanitizing the FX market and also vigorously enforce FX regulations to ensure that all legitimate demands for FX are met, forex 4 digit brokers. The CBN also directed the commercial banks to set up FX Teller points in all branches to ensure the direct sale of FX to buyers. On September 17 th, the CBN in recognition that the discontinuation of weekly FX sales to the BDC operators had no significant effect on the FX rates at the unofficial windows, the apex bank went further to clamp down on the sources forex 4 digit brokers the parallel market rates.
The parallel market rates posted on an online FX platform - Aboki FX. Whereas the official rate posted on the FMDQ Security Exchange website opened at N This represents an opening spread of N Therefore, the CBN referred to the online platform- AbokiFX, forex 4 digit brokers.
com as an illegal FX dealer, endangering the Nigerian economy. According to the CBN Governor, " The CBN act section 2, does make it clear that only the Central Bank can determine the value of the naira, forex 4 digit brokers, and yet a single individual living in England continues to manipulate the exchange rate and make a huge profit The apex bank governor said their investigation revealed that the players on the platform get naira loans, use them to purchase dollars, take a position, change the rate over a given period, sell the dollars they purchased and make a profit.
The CBN Governor also alleged that Mr. Oniwinde is an illegal forex trader with over 20 bank accounts in eight banks, filled with money from the speculative activities which he sell to Nigerian companies, thereby violating the country's foreign exchange laws. The CBN believes AbokiFX posts arbitrary rates without contacting the BDC operators and uses the platform for forex manipulations and speculations.
The CBN argued that this deliberate manipulation of the rates by the platform is spreading the gap between the official rate and the parallel rate which creates room for arbitrage by the platform owners and other players in the parallel market.
AbokiFX Argument. The company, AbokiFX founded inis a research and information service company, that conducts research and gathers data on the parallel market rates.
According to the company, " AbokiFX does not trade FX, forex 4 digit brokers, which we have always maintained in our emails and social media platforms.
Neither do we have the power to manipulate the rates, we do not create the rates. The company maintained that they simply collate and post data on forex 4 digit brokers website, citing companies using their data for internal and external audits as well as planning and budgeting.
They noted that the rates are sourced and carefully collated, thereafter reviewed and the mean rates posted from the data pool. Bankers Argument. Following the decision of the apex bank to halt the sales of FX to BDC operators, a development which has led to a significant depreciation of the naira against the dollar, the body of Chief Executive Officers CEOs of banks on July 30,stated that the banking industry was in full support of the CBN directives and are committed to selling foreign exchange to all legitimate customers as directed forex 4 digit brokers the CBN TheCable, In essence, the forex 4 digit brokers commended the CBN move as a means to make the dollar available to customers in different channels.
Analysts Argument. The Neutral Argument. N can buy 1. A single room costs N, per month in Aso Drive, Abuja, N, in Lekki, Lagos, and but the same room in Manhattan, New York City goes for N1. It costs an average of N daily to earn a degree in Nigeria, it cost an average of N1, a day to earn the same forex 4 digit brokers the US. The Opposing Argument.
Central Bank of Nigeria Governor, Godwin Emefiele, has no basis to finger AbokiFx. According to Abimbola Adelakun of Punch, the CBN Governor was long on allegations and emotionalism and short on actual substance. Nothing in his argument indict AbokiFX. Firstwith over 2 years of investigating AbokiFx, yet Emefiele has no accurate knowledge of the operations and activities of the platform.
The analysis he gave was mere speculation. So, he was calling on AbokiFX to come and explain their mode of operation. Secondthe CBN Governor was merely speculating on the number of bank accounts owned by the owner of AbokiFX and he assumed it was easy to get multiple loans from Nigerian banks. Thirdthe CBN Governor did not give specific instances and channels with which the AbokiFX dealers get the hard currencies.
He was allegedly being careful not to indict many of his paymaster, who is also known as forex billionaire dealers. This attests to Chief Anthony Ani's position of massive foreign exchange laundering in the Nigerian banking system. Fourththe daily reporting of the official rate and parallel market rate as done by AbokiFX is what newspapers used to do in the past. Lastlyspeaking from experience, Abimbola Adelakun argued that the difference between the rate posted by AbokiFX and the rates by the BDC agents differs by N, which makes sense considering the claims by the AbokiFX that the rate they posted is an average rate complied for each day.
Abimbola Adelakun concluded that the CBN Governor in his position should have known better than to ascribe the power to determine the exchange rate to a single website. The most important determinant of the value of the Naira is whether or not the Nigerian economy is productive and competitive in international trade.
Simply putthat is whether it has a diversified base of complex, value-added products it exports and earns forex from those exports. In essence, the current exchange rate crisis in Nigeria was triggered by the foreign exchange supply shortfalls, especially due to the mono-product structure of the economy now accelerated by the pandemic-induced global lockdown in The basic factor of supply and demand, forex 4 digit brokers.
If too much Naira is chasing scarce dollars, the dollar gets stronger relative to the Naira, forex 4 digit brokers, and vice versa. Currently, there is excess demand for dollars against the naira to import products such as petrol, gas, power sources, and automobiles and for foreign services such as school fees, medical services, foreign holidays, and foreign loans.
The amounts of external reserves to back up the international value of Nigeria's legal tender is always under pressure due to the volatility and uncertainty of crude oil prices a primary product, which unfortunately is Nigeria's main forex earners. Non-diversification of the economy away from crude oil continues to worsen the naira crisis.
Yet, diversification of a resource-dependent economy like Nigeria requires a high level of knowledge, political will, and consistency in economic policy and takes decades to achieve.
Inflation affects naira value. A high inflation economy such as Nigeria weakens the value of the legal tender. High government indebtedness also weakens the legal tender. Nigeria's indebtedness relative to its revenues and ability to pay weigh-in on the naira, forex 4 digit brokers. Speculation also affects the naira value, as there are currency traders around the world for whom the weakness of a currency is their very good fortune.
A decline in net goods exports inflow from to weakens the foreign exchange. Forex 4 digit brokers historical negative balances on Nigeria's trade in services and income also weaken Nigeria's foreign exchange. The MPC decision to hold MPR at In comparison, the UK base rate is at 0. This continues to contribute to the pressure on forex 4 digit brokers against the dollar as productivity is impaired in the economy. Nigeria's tax law support that dollar remittance is retained abroad and is laundered by Nigerian banks Chief Anthony Ani, For instance, tax laws in India accommodate its citizens living abroad who wanted to send money in foreign exchange to India.
Forex 4 digit brokers is against the law regarding Nigerians repatriating remuneration from abroad in foreign currency instituted in under Chief Anthony Ani's watch as Minister of Finance. Thus, Nigeria is re-exporting its remittances abroad The only country in the world doing that. Interests of Speculators. Wherever governments try to cover up supply shortfalls by pegging the official exchange rate at a value that does not equate supply with demand, gaps, spreads, or premiums emerge between rates in official and parallel market segments.
These premiums, on one hand, are very informative when the market is out of equilibrium as they largely reflect the size of the supply shortfalls or the distance of pegged exchange rate from market realities. On the other hand, these premiums give speculators the incentive to profit therein.
The Naira against the US dollar has been on a free-fall after the MPC meeting held between July 26,where the CBN cut FX supply to the BDCs, and September 17,when AbokiFX was clamped down. The value of naira fell significantly in the parallel market compared with a marginal fall in the official market.
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, time: 11:27Thoughts and Reflections on the Forex Crisis - Proshare Research
12/11/ · Lordstown Motors Corp (NASDAQ: RIDE) tanked in the after-hours trading on Thursday. Riding High, Riding Low: The struggling electric vehicle startup's stock soared nearly 24% to 27/09/ · For example AUD/JPY at (4)7. (4) represents a pip. The last digit represents a pipette (7) Similarly, pairs quoted in 5 decimal points, a pip is on the fourth decimal. In a EUR/USD at (4)4. It is represented in a bundle of by Forex brokers Related News - Forex. 1. Gross Official Reserves Increased to US$36,8bn in September 2. NAFEX Rate Depreciated by % WoW to N from N 3. The Endless Roller Coaster of the Naira in 4. A Market Determined FX Regime is Nigeria's Best Option - Muda Yusuf. 5. NAFEX Rate Depreciated by % WoW to N from N 6
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