Naira/U.S Dollar Rates Remain Stable as CONVID-19 Reduces Need for US Dollars…

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A gas station attendant displays a large bundle of naira banknotes after selling fuel to a customer in Port Harcourt, Nigeria, on Friday, Jan. 15, 2016. With his security forces engaged in fighting Boko Haram's Islamist insurgency in the north, President Muhammadu Buhari can't afford renewed rebellion in the delta. Photographer: George Osodi/Bloomberg

In the just concluded week, NGN/USD remained unchanged in most foreign exchange market segment amid weekly injections of USD210 million by CBN into the foreign exchange market: USD100 million was allocated to Wholesale Secondary Market Intervention Sales (SMIS), USD55 million was allocated to Small and Medium Scale Enterprises and USD55 million was sold for invisibles.

At the Interbank Foreign Exchange market, Naira/USD was flat at N358.51/USD.

Similarly, exchange rate was unchanged at the Bureau De Change and the parallel (“black”) markets at N358/USD and N360.00/USD respectively as the outbreak of CONVID-19 appears to have reduced the need for the US Dollar.

However, Naira depreciated at the Investors and Exporters FX Window (I&E FXW) by 0.27% to close at N366.25/USD.

Elsewhere, the Naira/USD exchange rate rose (i.e Naira depreciated) for most of the foreign exchange forward contracts: 1 month, 2 months, 3 months, 6 months and 12 months rates depreciated by 0.59%, 0.92%, 1.26%, 2.39% and 4.11% respectively to close at N368.94/USD, N371.66/USD, N374.42/USD, N383.88/USD and N408.94/USD, respectively.

In the new week, we expect stability of the Naira against the USD across the market segements against the backdrop of the Senate’s approval of the USD22.7 billion Eurobond loan request by the Federal Government.

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