Nigerian economy needs foreign exchange stability – Experts

Market operators have suggested that Nigeria’s economic recovery as well as stock market gains can only be sustained with a stable foreign exchange system.

Mr Sewa Wusu, Head Research, SCM Capital Ltd., said that foreign exchange stability would be a strong impetus for improved market performance.

Wusu added that market liquidity would increase if the Central Bank of Nigeria (CBN) current foreign exchange policy drive was able to attract foreign participation in the market.

He said the bullish resurgence witnessed so far was due to the release of impressive first quarter results by major companies, especially the tier one banks.

I think by and large the performance of the tier-1 banks are in tandem with expectations and that created the positive sentiments in the market last week,” he said.

He explained that the performance of the market going would be dependent on the sustainability of earnings of companies and foreign exchange stability.

On his part, Mr Ambrose Omordion, Chief Operating Officer, InvestData Ltd., said that more encouraging economic data and eventual passage of the much-awaited 2017 budget would improve market liquidity.

Omordion said good times were ahead for investors with relative peace and security in the Niger Delta region and stability in oil output.

He urged for the quick passage of the 2017 budget, to quicken economic activities nationwide and also ensure the effective implementation of the Federal Government Economic Recovery and Growth Plan (ERGP).

The investment banker explained that traders and investors who understood the importance of combining fundamental and technical analysis in making investment decisions in the stock market should take advantage of the present opportunities and position.

According to him, this will enhance their medium and long term gains.