Naira Recovers Against USD at the I&E FX Window as Crude Oil Prices Rise…

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In the just concluded week, the Naira/USD
exchange rate recovered (Naira appreciated) by 4.37% to close at N416.00/USD at the Investors and Exporters FX window as Bonny Light price, the Nigerian variant of crude oil, rose w-o-w by 3.80% to USD82.13 as at Thursday, January 6, 2022.

However, Naira depreciated against the greenback by 1.29% to close at N572.20/USD
at the Parallel market.

At the Interbank Foreign Exchange market, NGN/USD closed flat at N430.00/USD amid CBN’s weekly injections of USD210 million: 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.

Meanwhile, the Naira/USD exchange rate appreciated for all foreign exchange forward contracts.

Notably, 1 month, 2 months, 3 months, 6 months and 12 months contracts fell by 0.50%, 0.93%, 0.86%, 1.21% and 1.33% to close at N416.78/USD, N419.37/USD, N422.70/USD, N432.40/USD and N442.85/USD respectively

In the new week, we expect Naira to remain stable against the USD as the price of crude oil at the international market remain elevated following the agreement by OPEC+ producers to stick to their planned increase for February based on indications that Omicron would have only a mild impact on demand.