Naira Depreciates Despite CBN’s $150m FX Sales to Banks
The naira depreciated at the official window in spite of the fact that the Central Bank of Nigeria (CBN) was in the market to intervene, selling $150 million across auction.
Despite persistent intervention by the CBN and Foreign Portfolio Investors (FPIs) inflow, demand pressure continued to push the Nigerian Naira lower against the US dollar.
The official spot FX rare during the week weakened by N10.09 per dollar. Notably, the Naira traded within a range of N1,450.00 to N1,469.90 per US dollar within the week.
FX traders said the outlook in the currency market remains positive due to removal of exchange rate lacuna, and sustained fx intervention by the authority.
Amidst oil prices uncertainties, the external reserves took a dive last week. Data from the CBN showed that gross balance in the nation’s external reserves halt the 2months uptrend, dipping by $263.15 million to $45.21 billion.
Elsewhere, oil prices edged lower week-on-week despite Friday’s rally on possible disruptions from a U.S. blockade of Venezuelan tankers as the market waits for news about a possible Russia-Ukraine peace deal.
Brent crude futures for February settled at $59.47 per barrel, down 65cent or 1.06% week on week, while West Texas Intermediate (WTI) futures closed at $55.52 per barrel, losing 92cents.
In contrast, gold edged up this week, driven by safe haven demand amid weak U.S. consumer sentiment and broader economic uncertainty, despite firm U.S. dollar strength and Treasury yields.
Consequently, spot gold rose by 0.84% to finish at $4,338.55 per ounce. Analysts expect market sentiment next week to remain cautious but supportive of gold as a safe-haven asset amid softer U.S. inflation and a firmer dollar, while oil prices may continue to face pressure or volatile trading as oversupply concerns persist. Tech Stocks Nvidia, Alphabet Drag Global Equities Markets
