Naira Gains against Dollar in Black Market…

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In the just concluded week, Naira appreciated against the USD at the parallel (“black”) market by 0.22% to close at N462/USD.

However, the Naira remained flattish against the USD at the Investors and Exporters Window and Bureau De Change at N386/USD and N457/USD respectively despite the moderation in crude oil prices at the international market.

Similarly, NGN/USD closed flat at N381/USD at the Interbank Foreign Exchange market amid weekly injections of USD210 million by CBN into the forex 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.

Elsewhere, 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 declined by 0.06%, 0.14%, 0.24%, 0.20% and 0.67% respectively to close at N386.25/USD, N386.49/USD, N386.69/USD, N388.33/USD and N392.74/USD respectively. However, spot rate closed flat at N381.00/USD.

In the new week, we expect Naira/USD to remain stable at the Bureau De Change market amid sustained intervention by CBN.

However, we note that the domestic currency may depreciate marginally against the greenback at the Investors and Exporters FX Window (I&E FXW) if crude oil prices moderate further in the new week.

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