In the just concluded week, the Naira weakened by N6.00 (1.42%) w/w against the dollar from last week’s close of N423/USD to N429/USD at
the I&E FX Window due rising demand by importers and manufacturers alike.
However, at the parallel market segment, the
negative reaction to the comments from the CBN Governor at the last MPC meeting prompted an 8.33% (N55.00) w/w depreciation of the Naira against the greenback at the Parallel market to close at a historic low of N715/USD from N660/USD in the prior week.
Furthermore, 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 trended upward last week for all the foreign exchange forward contracts.
Specifically, 1 month, 2 months, 3 months, 6 months and 12 months contracts all gained 0.15%, 016%, 0.06%, 0.17% and 0.28% week on week to close at N428.04/USD, N432.31/USD, N435.75/USD, N448.87/USD and N473.02/USD in that order.
Elsewhere, the Bonny light price traded quietly to close the week at USD120.36 from USD120.36 per barrel in the previous week.
In the new week, we expect the local currency to trade relatively calm against the greenback barring market distortions while the CBN continues its weekly FX market interventions.