Naira, the nation’s currency on Monday depreciated by 0.60 percent against the dollar, following shortages at the official foreign exchange market.
At the close of trading on Monday, naira closed at N421.50 per dollar as against N419.00/$ on Friday at the investors and Exporters (I&E) forex market, data from the FMDQ indicated.
Most currency dealers who participated at the foreign exchange auction on Monday maintained bids between N412.00 and N444.00 per dollar.
While other foreign currencies are appreciating, the dollar has remained high, hitting N600/$ at the alternative market known as parallel or black market.
The local currency depreciated by 1.69 percent to N600 per dollar from N590 last week at the black market. Pounds Sterling appreciated by N45 to close at N735 on Monday from N780 last month at the parallel market. In the same market, Euro strengthened by N40 as it closed at N610 on Monday as against N650 per Euro last month.
Total foreign exchange sales to authorised dealers by the Central Bank of Nigeria (CBN) decreased by 3.6 per cent to US$5.15 billion in the fourth quarter of 2021, compared with the level in the preceding quarter, according to a report by the CBN.
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A disaggregation showed that sales to Investors and Exporters’ window rose by 142.3 per cent to US$1.93 billion, relative to the level in the preceding quarter, reflecting increased demand pressure. However, foreign exchange sales at interbank and Secondary Market Intervention Sales (SMIS) window declined by 24.0 per cent and 4.4 per cent to US$0.55 billion and US$2.00 billion, respectively, relative to the levels in the preceding quarter, reflecting lower demand.
Similarly, SME interventions and matured swap contracts also decreased by 5.5 per cent and 67.4 per cent to US$0.38 billion and US$0.29 billion, compared with the preceding quarter.
The CBN’s economic report for the fourth showed that the average turnover at the I&E segment increased by 14.9 per cent to US$0.19 billion, relative to the level in the preceding quarter, reflecting increased liquidity in the window, following sustained foreign exchange intervention by the apex bank.
At the money market, he Overnight (O/N) rate decreased by 0.92 percent to close at 8.25 percent on Monday as against the last close of 9.17 percent. Similarly, Open Repo (OPR) rate decreased by 0.83 percent to close at 7.83 percent compared to 8.66 percent on the previous day.
