In a report by Vanguard, the governor of the Central Bank of Nigeria, Mr. Yemi Cardoso, said that the value of dollar in Nigeria is determined by the balance of dollars entering the country and demand for dollars among Nigerians....CONTINUE READING THE FULL ARTICLE>>>
He addressed the lawmakers in Abuja, elucidating the factors contributing to the foreign exchange challenges confronting the nation.
Mr. Cardoso argued that he should be allowed to assert that the exchange rate is dictated by the interplay of supply and demand for a product or service.
Essentially, akin to the pricing mechanism for commodities such as cows or cars, the worth of the US Dollar in Nigeria is shaped by the equilibrium between the influx of US Dollars into the country and the demand for US Dollars among Nigerians.
In Mr. Cardoso’s words, “Permit me to say that the exchange rate is determined by the dynamics of supply and demand for a product or service.
In essence, similar to the pricing of cows or cars, the value of the US Dollar in Nigeria is determined by the balance of US Dollars entering the country and the demand for US Dollars among Nigerians.
Applying this demand and supply principle, let’s examine how the exchange rate has performed in recent years. The exchange rate in Nigeria has increased/depreciated due to the simultaneous occurrence of two factors: a decline in the supply of US Dollars coinciding with a surge in the demand for US Dollars…CONTINUE READING>>
