Naira Mixed as Eurobonds Raise Boosts Market Confidence
The naira exchange rates mixed as Nigeria’s $2.2 billion Eurobonds raised boosted market confidence. FX Spot rate at the Nigerian autonomous foreign exchange market remained steady but interbank rate on BMatch system popped.
The naira held steady, closing at N1,672.69 per dollar in the official market, reflecting no change from the previous rate. But the exchange rate appreciated by 1.1% to N1,655.74 per greenback in the Electronic Foreign Exchange Matching System (EFEMS), Cordros Capital Limited said.
The interbank Electronic Foreign Exchange Market saw trades executed around N1,585 and N1,678 per US dollar, FX analysts at AIICO Capital Limited explained further in a note.
The move to automated currency trading appears to have kept exchange rate volatility in check for the second trading session on BMatch system introduced on December 2.
Analysts are of the view that an automated FX platform will increase transparency in currency trading activities in the official market. US dollar liquidity has remained sufficient to match bids from authorised dealer banks.
In addition to more than $40.2 billion gross balance in Nigeria’s external reserves, the authority raised $2.2 billion from the Eurobond market at the beginning of the week. The US dollar auction was oversubscribed to the tune of $9 billion. The debt office offered 10-year notes at 10.375% to offshore investors seeking to take advantage of elevated yields in the economy.
In the parallel market, it ended the day at N1,720 per US dollar, gained N10 from the previous close as yearend demand declined. With increasing foreign currencies transfer to families ahead of Yuletide, Nigerians in diaspora are boosting FX liquidity in the black market.
On Tuesday, oil prices rose by over 1% in the global commodities market as investors focused on the upcoming OPEC+ meeting later this week. Brent traded at $72.93 per barrel, and WTI stood at around $69.18 at the end of business on Tuesday.
Gold prices receded after a robust U.S. labor report. However, a weaker dollar and declining Treasury yields helped mitigate losses as markets looked ahead to additional economic data to assess the Federal Reserve’s interest rate strategy.
The price of gold was about $2,641.53 per ounce #Naira Mixed as Eurobonds Raise Boosts Market Confidence FBN Holdings Sheds 8% as Investors Exit Positions
