Naira Dips at Official, Parallel Markets over FX Payments
The naira depreciated across the Nigerian foreign exchange markets on Monday over increased international transactions settled via the official window.
The local currency had gained more than N5 per dollar at the official window last week, supported by the Central Bank intervention to maintain a stable exchange rate.
The market had also witnessed softer pressures that enhanced the weekly gain posted by the local currency, with support from FX inflows from the CBN, non-bank corporates, exporters and other related sources.
Data released by the CBN showed that the spot FX rate dropped by 0.16% to ₦1,420.28/$. The depreciation was driven by relatively higher demand than the available supply as the naira traded within a range of ₦1,421.00 and ₦1,419.50 per USD.
Also, the naira weakened by 1.08% to ₦1,480/$ in the parallel market, indicating diminished currency sentiment across both the regulated official segment and the informal foreign exchange market.
Nigeria’s gross external reserves balance increased by $40.71 million to the previous day’s balance, bringing total reserves to $45.90 trillion amidst oil price fluctuations.
In the global commodity market, Oil prices steadied on Monday as civil unrest in Iran subsided, reducing the likelihood of a U.S. attack that could disrupt supplies from the major producer, while market-watchers turned their attention to the stand-off over Greenland.
Brent crude edged up by 0.05%, hovering around $64.16 per barrel, while U.S. West Texas Intermediate (WTI) rose slightly by 0.15%, to around $59.43.
However, Gold hit record highs on Monday, driven by a flight to safety after U.S. President Donald Trump warned of extra tariffs on some European countries in a dispute over Greenland.
Spot gold price climbed 182bps to $4,678.58/oz, while U.S. gold futures followed, rising by 187bps to $4,681.49/oz. Analysts expect markets to trade cautiously with continued safe-haven demand supporting precious metals and oil prices remaining relatively steady amid geopolitical risk and mixed macro signals. EUR Rises as U.S Interest in Greenland Weakens Dollar Index
