Naira Depreciates to N1467.95, Lost 6.4% in May
The naira depreciated further on Tuesday over persistent US dollar demand surge by eligible participants at the Nigerian autonomous foreign exchange market. According to data from FMDQ Securities Exchange official daily quotation, the Nigerian local currency depreciated by 0.06% against the US Dollar, closing at a rate of ₦1,476.95.
Similarly, exchange rate depreciated by 0.69%, ending at N1,455 per US dollar in the parallel market as foreign currency demand by invisible FX users increased. In May, the naira traded negatively across various forex segments, depreciating by 6.40%, or N95.03 month on month, at the official market to close at N1,485.99 to the dollar.
In May, the exchange rate opened at N1455.59 to the US dollar. The sustained increase in FX demand versus short supply from the CBN plunged the exchange rate to an abysmal level.
The market witnessed US dollar liquidity shortage across the segment in the currency market last month. The local currency also declined by 6.29%, or N90.00, per month in the parallel market, closing at N1,430 to one US dollar.
Last week, in a fast and furious manner, the apex bank conducted forex sales ahead of $1.3 billion non-deliverable forwards that matured. Despite this, the depressed local currency moved slowly against the US dollar.
The weak net external position has caused a slowdown in FX market intervention. Data from CBN showed that gross external reserves closed at $32.694 billion in May amidst tight FX inflows and increased demand for foreign currency by eligible users.
In the global commodity market, oil prices continue to trade downward as bearish sentiments build due to OPEC+ underwhelming the market with its plan to phase out production cuts over the next 12 months gradually. #Naira Depreciates to N1467.95, Lost 6.4% in May
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