Naira Hovers at 2-Week Low Against U.S Dollar
The naira exchange rate worsened for 11 consecutive trading sessions in the currency market as pressure from dollar demand persisted amidst soft interventions.
Trading at 2 weeks low, the Naira depreciated by ₦2.80 against the U.S. Dollar at the Nigerian Foreign Exchange market (NFEM) after $200 million was pumped last week to boost liquidity.
According to analysts at AIICO Capital, the depreciation was driven by sustained high USD demand pressure amid global risk-off sentiment across emerging market assets.
The Naira traded within the ₦1,382.50/$ and ₦1400.00/$ range during the session before settling at ₦1,387.10/$, the worst spot rate in 2 weeks.
Meanwhile, external reserves was noted at $49.69 billion, reflecting an addition of $89.14 million day-on-day amidst oil price swings.
Oil prices were little changed on Wednesday despite a volatile trading session, as renewed U.S. and Israeli strikes against Iran escalated regional tensions and paralysed shipping through the Strait of Hormuz for a fifth day, disrupting vital Middle East oil and gas flows.
Brent crude shed 26bps or 21 cents, hovering around $81.19 per barrel, while U.S. West Texas Intermediate (WTI) lost 5bps to around $74.52 per barrel.
However, gold prices rose following a hefty fall in the previous session, as a weaker dollar prompted investors to return to the yellow metal’s safe-haven status.
Spot gold price rose by 91bps, to around $5,133.85/oz, while U.S. gold futures lost by 79bps, hovering around $5,145.21.74/oz. Analysts expect gold to remain bid on safe-haven demand and oil to stay elevated on continued Middle East supply risk…GTCO Climbs to N4.3trn Ahead of 2025 Earnings
