Naira Falls for 8-Day over Insufficient FX Supply
The naira fell for eight days since last week due to insufficient foreign currency supply in the official window. Forex market intervention has slowed down amidst strong decline in external reserves.
Analysts said the Central Bank has stepped down on its aggressive back up for the naira as Nigeria’s foreign reserves declined to $39.154 billion this week as a results of foreign payments obligations.
After a strong rally that caused exchange rate re-rating below N1500, the official window has been witnessing consecutive negative movement. According to spot FX data obtained from the FMDQ platform, the Naira depreciated by 0.23%, closing at ₦1,515.06 per dollar.
However, exchange rated appreciated by 0.32% in the parallel market rate to close at N1,570, according to CardinalStone Limited. The Nigerian Foreign Exchange Market (NFEM) faced ongoing demand pressure for foreign currency due to constrained supply, maintaining a predominantly bid market.
AIICO Capital Limited said most transactions occurred between $/₦1,480.00 to $/₦1,520 in the official market today. Oil prices declined by over 1%, weighed down by ongoing prospects of a peace deal between Russia and Ukraine, along with rising crude inventories in the U.S.
Brent crude had fallen $1, or 1.3%, to $74.18 per barrel, while U.S. West Texas Intermediate (WTI) crude dropped 97 cents, or 1.4%, to $70.40. Meanwhile, gold prices rose as concerns grew over U.S. President Donald Trump’s upcoming tariff plans, which could further strain global trade relations.
Spot gold gained 0.3% to $2,913.40 per ounce, edging closer to its record high of $2,942.70 reached on Tuesday. U.S. gold futures advanced 0.4% to $2,941.40. #Naira Falls for 8-Day over Insufficient FX Supply CBN Opens FX Window for BDC to Stock up at NFEM Rate
