CBN Funds International Payments with $250 Million
The Central Bank of Nigeria (CBN) funded international payments with $250 million injected into the foreign exchange market in the last five trading sessions.
The naira depreciated as demand for the US dollar continues to increase above the FX levels in the official currency market. The spot FX rate reached a weekly high of N1456 before its last-minute rebound, aided by the Apex Bank intervention.
The US dollar demand pressures eased as a combination of CBN FX sales, foreign portfolio investors, non-corporate bank, and exporters enhanced liquidity.
Despite continued intervention by the CBN, demand pressure pushed the Nigerian Naira lower against the USD in the Nigerian Foreign Exchange Market (NFEM), weakening by ₦3.98 per USD
The CBN injected $250 million into the forex market amidst growing external reserves. Meanwhile, gross FX reserves increased for the twenty-fifth consecutive week, growing by a strong USD396.84 million w/w to USD45.44 billion
Elsewhere, oil prices closed lower on Friday, marking a 4% weekly decline as a supply glut and a potential Russia-Ukraine peace deal outweighed worries about any impact from the U.S. seizure of an oil tanker near Venezuela.
Brent crude futures for February settled at $61.12 per barrel, down $2.63 or 4.13%, while West Texas Intermediate (WTI) futures closed at $57.44 per barrel, losing $2.64 or 4.39% week on week.
In contrast, gold prices hit its highest level in more than a month after the U.S. Federal Reserve’s quarter-point rate cut pushed the dollar lower, while silver surged to a record high during the week. Consequently, spot gold rose by 2.51% to finish at $4,302.43 per ounce.
Analysts express that markets are likely to remain cautious but tilted toward safe-haven assets like gold amid lingering Fed uncertainty and geopolitical risks, while oil prices may see mixed direction as supply and demand concerns balance price support. #CBN Funds International Payments with $250 Million
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