• Friday, February 23, 2024
businessday logo

BusinessDay

Naira slides despite 61.86% dollar liquidity rise

Naira gains for second straight day amid rising bank dollar sales

Nigerian Naira lost 1.15 percent of its value against the dollar at the official market despite an over 60 percent increase in foreign exchange (FX) liquidity on Wednesday.

After trading on Wednesday, one dollar was quoted at N840.53, which was weaker than N830.97 quoted on Tuesday at the Autonomous Foreign Exchange Market (NAFEM), data from the FMDQ indicated.

The FX market recorded increased dollar liquidity as the daily foreign exchange market turnover rose by 61.86 percent to $198.21 million on Wednesday from $122.46 million recorded on Tuesday.

Currency dealers quoted dollars as high as N1,135 on the spot segment and as low as N743.43 per dollar.

At the parallel market, popularly called black market, naira depreciated against the dollar as the FX market closed at N1,150/$1 on Wednesday.

This represents 0.43 percent compared to N1,145/$1 exchanged on the previous day.

The dollar was quoted at the same rate of N1,150 in Lagos, Abuja and Anambra State.

Read also Naira weakens across FX markets as dollar shortage lingers

At the money market, the Nigerian treasury bills secondary market closed on a mildly positive note on Wednesday as the average yield across the curve decreased by 1 basis point to 12.82 percent from 12.83 percent on the previous day, according to a report by FSDH research.

Consequently, average yields across short-term and long-term maturities declined by 1 basis point each. However, the average yield across the medium-term maturities closed flat.

The Overnight (O/N) rate increased by 1.33 percent to close at 25.17 percent as against the last close of 23.84 percent, and the Open Repo (OPR) rate increased by 0.90 percent to close at 23.83 percent compared to 22.93 percent on the previous day.

The Open Market Operation (OMO) bills market closed on a mildly positive note on Wednesday, as the average yield across the curve cleared lower by 1 basis point to close at 14.69 percent from 14.70 percent on the previous day. The average yield across the long-term maturities declined by 1 basis point. OMO 29-Oct-24 (-1 basis point) witnessed mild buying interest.