Naira Touches N1,522 Briefly after CBN FX Interventions
The naira gained more than N5 on US dollar at the Nigerian foreign exchange market after the Apex Bank boosted FX liquidity at the official window last week. FX update from the Central Bank of Nigeria (CBN) showed that local currency was quoted at N1526.0940 per dollar at the official window on Monday, from N1,531.5703 the previous day.
FX traders reported that the spot rate touched an intraday high of N1531 on Monday in the absence of significant US dollar demand from corporate FX users. The supply side remained buoyant during the intraday session, supported by foreign portfolio investors’ inflows and CBN FX sales to banks.
The Apex Bank played actively at the forex market last week, selling $170 million to authorised dealers, banks after spotting a mild run against the local currency at the official window. Also, offshore investors’ participation at the open market operations conducted strengthened dollar inflows at the supply side.
Last week, the Naira appreciated slightly by 0.23% or N3.47 to close at N1,531.57/US$1 in the Nigerian Autonomous Foreign Exchange Market. In the parallel market, the currency gained 0.97% week on week to settle at N1,540.00/US$1.
Total FX inflows into the NFEM window settled at US$706.70 million, Coronation Merchant Bank research unit said in a note, down from US$751.70 million recorded in the previous week.
Non-bank corporates recorded the highest inflows, accounting for US$250.00 million of total inflows. This was followed by foreign portfolio investment inflow of US$198.30 million while exporters US$145.100 million, according to Coronation.
Analysts said the CBN accounted for inflows of US$88.50 million. Meanwhile, inflows from individuals and other sources accounted for 0.81% and 2.70%, respectively. Gross external reserves as published by the CBN increased to US$41.27 billion at the end of August, its highest level since 2021.
In the global commodity market, Brent Crude closed 1% higher on Monday as intensifying airstrikes in Russia and Ukraine fuelled worries about supply disruptions, while a weaker dollar provided added support.
Brent futures rose 67 cents to $68.15 per barrel, and U.S. West Texas Intermediate climbed 67 cents, or 1.1%, to $64.68. Meanwhile, gold surged to a more than four-month high, trading just $23 below its record, boosted by expectations of Fed rate cuts and a softer dollar.
Spot gold gained 0.9% to $3,477.56 per ounce, its highest since April 22, while December U.S. futures also advanced 0.9% to $3,547.70. Silver broke $40 for the first time since 2011. The next key focus is whether OPEC+ will extend output increases beyond September, with a decision expected shortly. #Naira Touches N1,522 Briefly after CBN FX Interventions #CBN Defends Naira With $586 Million in August
