Naira Depreciates Against Dollar at Investors & Exporters Window

As global oil prices moderate in the week, Naira depreciates against dollar at the Investors and Exporters foreign exchange window.

In the week, the local currency depreciated against the USD by 0.10% to close at

₦386.33/USD as the rally in crude oil prices slowed at the international market.

However, Naira appreciated against the USD at the Bureau De Change and the parallel markets by 2.22% and 2.17% respectively to close at ₦440.00/USD and ₦450.00/USD respectively.

Naira paired against USD closed flat at the Interbank Foreign Exchange market, at ₦358.51/USD, amid weekly injections of USD210 million by CBN into the foreign exchange market.

Record shows that USD$$100 million was allocated to Wholesale Secondary Market Intervention Sales (SMIS).

Also, USD$55 million was allocated to Small and Medium Scale Enterprises and USD$55 million was sold for invisibles.

Elsewhere, the Naira/USD exchange rate rose (depreciated) for most of the foreign exchange forward contracts: 1 month, 2 months, 3 months, 6 months and 12 months rates gained 0.12%, 0.12%, 0.13%, 0.15% and 0.20% respectively to close at ₦388.14/USD, ₦389.96/USD, ₦391.82/USD, ₦397.30/USD and ₦415.84/USD respectively.

However, spot rate was unchanged at ₦361.00/USD.

Naira Depreciates
Naira Depreciates Against Dollar at Investors and Exporters Window

Cowry Asset Management stated that it expects the Naira to depreciate against the USD, especially at the I&E FX Window following recent decline in crude oil prices next week.

Meanwhile, Afrinvest stated that the total value of open contracts of the naira at the FMDQ Securities Exchange (SE) FX Futures Contract Market declined.

It dropped by 9.8% ($1.5 billion) to $13.9 billion as the MAY 2020 instrument matured during the week.

The JUNE 2020 instrument contract price of ₦389.49 received the highest subscription of $436.8 million which took total value to $1.6 billion.

On the other hand, the AUG 2020 instrument contract price of ₦395.14 recorded the least subscription of $0.5 million with a total value of $1.0 billion.

“We expect exchange rates to remain range-bound across the different segments of the market as investors anticipate the resumption of FX sales by the CBN”, Afrinvest stated.

Naira Stands Strong as Global Price of Oil Decline

Naira Depreciates Against Dollar at Investors & Exporters Window

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