Naira Drops to N1,346 as Momentum Slows
The naira dropped at the official window, settling at N1346 per dollar as the rally slowed down after early momentum. For three consecutive trading sessions, the local currency has been pulling back due to increased demand for the US dollar in the currency market.
According to data released by the Central Bank of Nigeria (CBN) on Friday, the official rate dropped by 0.37% to ₦1,346.32/$ at the forex window, from ₦1,341.35/$ the previous day.
Spot rates traded between an intraday low of N1,343 per dollar and a high of N1,349, suggesting a spike in foreign payments beyond what the supply side can handle.
On the other hand, the local currency appreciated by 0.19% to ₦1,333/$ in the parallel market, Cowry Asset Limited reported, reflecting divergent currency dynamics between the regulated official segment and the informal foreign exchange market.
The informal segment experienced consecutive gains in naira following the announcement of $150,000 in weekly FX sales to licensed Bureau de change operators.
Nigeria’s external reserves maintained an uptrend, with the gross balance staying above $48 billion amid uncertainties in the global commodity market.
Oil prices traded near six-month highs on Friday, heading for their first weekly gain in three weeks as markets expected U.S. military action against Iran would not happen until next week.
Brent is above $72 per barrel, and US West Texas Intermediate has surged to $67 amid supply shock expectations from the Middle East.
In the global forex market, the US dollar is trading mostly firmer but quietly. The dollar has risen against the G10 currencies this week. The yen has been the weakest, down by almost 1.65%.
The Australian dollar has been the best performer, and it is off about 0.3% this week. Most emerging market currencies also declined this week. The Argentine peso (~0.6%), the Russian ruble (~0.2%), and the Brazilian real (0.15%) have been the best performers. MOFI to Pay Final Dividend to Shareholders
