Donald Trump has been elected the 45th president of the United States and his victory doesn’t look too good for the Naira, according to market analysts.
This follows reports that the local currency has dropped N5 to trade at N470/$1 as against the N465/$1 it was yesterday, November 8.
Although the new depreciation of the Naira can’t be immediately attributed to the emergence of Trump as US president-elect, his victory may impact Nigeria through uncertainty and risk aversion which will punish emerging markets.
This means when the US economy is unstable, most of the other economies of the world will feel the adverse effect and Nigeria isn’t left out.
According to Lukman Otunuga, a market analyst, a win for either Trump or Clinton can represent a negative impact to the global economy.
But while markets looked more supportive of a Clinton victory, Republican candidate Trump turned the form book by pulling off one of the greatest shock ever.
And with his victory, Jameel Ahmad, chief market strategist at FXTM, believes Trump win could result in growth forecasts being downgraded at least in the short term due to investor uncertainty.
This will in theory weaken demand for commodities like oil and weigh on the valuation of oil. In the long run, this may be bad for the Nigerian economy, with oil prices expected to fall again.
Meanwhile, you can check out NAIJ.com’s Bureau De Change ‘market’ here for the best rates on foreign exchange.
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