Naira Rebounds Amid Decline in Oil Export Plan
Naira appreciated at the Investors’ and Exporters’ foreign exchange window on Wednesday, trading at N463.33 per United States dollar amidst forex scarcity in the local economy. The local currency continues to face pressures from increased demand and lower forex supply.
Oil receipt has been unstable and portfolio investors have maintained distance over weak market returns, and capital control while US Fed, ECB, and Bank of England rates hikes continue to trigger FX outflow from the African market.
In the bond market, yields moved in a mixed direction amidst interest rate hikes and inflation pressures. The Exchange rate across the FX markets wormseed at the weekend as the market begins to weigh uncertainties in the economy ahead of May 2029
Traders said the new spot FX rate translates to 0.23 percent daily appreciation; trading lower below N464 from N464.42 on Tuesday. Market data showed that the open indicative rate closed at N464.29 to the dollar on Wednesday.
On the FMDQ Exchange platform, an exchange rate of N467 to the US dollar was the highest rate recorded within Wednesday’s trading before it settled at N463.33.
Currency traders said the naira sold for as low as N460 per US dollar within Wednesday’s trading. A total of 77 million dollars was traded at the official Investors and Exporters window on Wednesday.
On the other hand, the parallel market depreciated by 0.06% to N761 from N760 amidst dwindling foreign reserves. Nigeria’s gross external reserves printed below $35.2 billion ahead of May 29 handover.
In the global crude oil market, Brent rose 1.38% to $77.04 per barrel, while West Texas Instruments (WTI) crude gained 1.95% to $73.45 per barrel.
Oil futures rose on Tuesday, as seasonal energy demand outweighed demand concerns amid a stall in US debt ceiling talks. Elsewhere, gold was hovering around $1,972 per ounce (+0.15%), boosted by a downtick in US Treasury yields.
July export plans for some of the key Nigerian crude oil streams emerged on Tuesday, showing a slight decrease from the previous month.
Loadings from the Forcados, Bonny Light, Bonga, and Qua Iboe streams will total about 600,000 barrels per day (bpd), compared with 580,000 bpd in June. The trimmed volumes were on the Bonny Light and Forcados streams, which technical issues have plagued in recent months, traders said.
The Escravos stream will load four cargoes, Erha and Agbami three, Agbami three, and Yoho two. Angola’s Sonangol offered a July loading cargo of Girassol crude at dated Brent plus $2.60 a barrel, but it was unclear if it was sold. # Naira Rebounds Amid Decline in Oil Export Plan