In the just concluded week, NGN/USD rate fell (i.e. Naira appreciated) at the Investors and Exporters FX Window (I&E FXW) by 0.10% to close at N362.02/USD, in line with our expectation.
However, the NGN/USD exchange rate was flattish at the Bureau De Change as well as the parallel (“black”) markets, closing at N358.00/USD and N360.00 respectively.
Elsewhere, the Naira depreciated against the US dollar by 0.03% to close at N358.13/USD at the Interbank Foreign Exchange market despite the 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 (i.e. Naira appreciated) for most of the foreign exchange forward contracts – 1 month, 2 months, 3 months, 6 months and 12 months rates fell by 0.11%, 0.09%, 0.03%, 0.26% and 0.42% to close at N365.31/USD, N368.73/USD, N372.28/USD, N382.97/USD and N409.45/USD respectively.
However, spot rate was flattish at N306.95/USD. In the new week, we expect appreciation of the Naira against the USD across the market segements as seemingly renewed interest by foreign porfolio investors in local financial assets is further felt amid rate cut in US.