Naira Drops to N1,353 as Foreign Reserves Decline
The Nigerian naira dropped to N1353 per dollar at the official window on Wednesday, reflecting increased pressure from foreign payments by eligible market participants.
Confirming this, the Central Bank of Nigeria (CBN) daily FX update publication indicated that the local currency reached an intraday high of N1,362 per dollar, up from N1355 the previous day.
Meanwhile, the spot rate was quoted at an intraday low of N1,349 per dollar, a sharp retreat from N1340 from the previous trading session.
Nigeria’s external reserves fell by $178 million over three consecutive international payments recorded by the Apex Bank, settling at $49.83 billion from $50.008 billion.
Oil prices surged late on Wednesday as the US Federal Reserve kept the federal funds rate on hold amid the global energy crisis and a relatively strong dollar.
The Federal Open Market Committee voted 11-1 to hold the benchmark federal funds rate in a range of 3.5% to 3.75%.
Markets were rattled as Iran and Israel traded strikes on key energy facilities in the Middle East, complicating efforts to curb a surge in energy prices.
The complex that houses the largest liquefied natural gas export plant has suffered “extensive damage” as the conflict spreads to encompass major Gulf energy infrastructure.
Currently, the Brent contract is trading up by over 5% to around $109 per barrel. At the same time, American WTI is up about 2%, and remains below the $98 mark.
This divergence is explained by the characteristics of these two benchmarks. Brent prices are heavily exposed to Middle Eastern production and global maritime trade. It is therefore bearing the full brunt of the current crisis. XRP Slips Below $1.40 as ETF Inflows Pause
