In the just concluded week, the Naira/USD
exchange rate rose (Naira depreciated) by
0.12% to close at N416.50/USD as demand for the greenback came in stronger.
Also, Naira depreciated against the greenback by 0.65% to close at N575.90/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 rose for most foreign exchange forward contracts.
Notably, 1 month, 2 months, 3 months and 12 months contracts fell by 0.06%, 0.14%, 0.05% and 0.96% to close at N417.04/USD, N419.94/USD, N422.92/USD and N447.12/USD respectively.
However, 6 months FX forward contract fell (Naira apopreciated) by 0.07% to close at N432.10/USD.
In the new week, we expect Naira to depreciate marginally against the USD as investors react to IMF’s call for increase in emerging economies’ benchmark interest rates and devaluation of their local currencies in anticipation of monetary tightening by Federal Reserve Bank of the United States.