In the just concluded week, NGN/USD rate fell (i.e. Naira appreciated) at most foreign exchange market segments. In particular, the NGN/USD exchange rate fell marginally at the Investors and Exporters FX Window by 0.01% to N360.79/USD.
Similarly, the Naira gained against the US dollar at the parallel (“black”) market and the Bureau De Change market by 0.28% each to N360/USD and N358/USD respectively in line with our expectation.
However, the exchange rate was flattish at the Interbank Foreign Exchange market at N357.52/USD amid sustained 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.
Meanwhile, the Naira/USD exchange rate fell for most of the foreign exchange forward contracts – 1 month, 2 months, 3 months, 6 months and 12 months rates rose by 0.07%, 0.18%, 0.32%, 0.65% and 0.49% to close at N363.31/USD, N365.93/USD, N368.70/USD, N378.54/USD and N401.72/USD respectively.
However, spot rate rose (i.e. Naira lost) by 0.02% to close at N307.00/USD, In the new week, we expect appreciation of the Naira against the USD across the market segements as CBN sustains its special interventions against the backdrop of rising external reserves.