Naira Stablises Against the US Dollar at Most Market Segments…

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A trader changes dollars with naira at a currency exchange store in Lagos, Nigeria in this February 12, 2015 file photo. Nigeria’s central bank is expected to make an interest rate decision this week. REUTERS/Joe Penney/File

In the just concluded week, the local currency appreciated at the Investors & Exporters Forex Window (I&E FXW) by 0.13% to close at N361.03.

However, the NGN/USD rate at the Interbank Foreign Exchange market fell (i.e Naira gained) remained unchanged at N356.97/USD amid weekly injections of USD210 million by CBN into the foreign exchange market via the Secondary Market Intervention Sales (SMIS) of which: USD100 million was allocated to Wholesale SMIS, USD55 million was allocated to Small and Medium Scale Enterprises and USD55 million was sold for invisibles.

Also, at the parallel (‘black’) market and Bureau De Change (BDC) market segments, Naira remained stable against the USD to close at N360/USD and N357/USD respectively.

Meanwhile, the Naira/USD exchange rate fell further (i.e. Naira sustained gains) for most of the foreign exchange forward contracts – 1 month, 2 months, 3 months and 12 months rates moderated by 0.19%, 0.28%, 0.39% and 1.86% respectively to close at N363.39/USD, N366.05/USD, N369.04/USD and N404.99/USD respectively; however, the Naira/USD exchange rate rose (i.e. Naira lost) at the spot market by 0.02% to close at N306.85/USD.

In the new week, we expect stability in the Naira/USD rate in most market segements, especially at the BDC Segment, as CBN sustains its special interventions.

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