Trading at the foreign exchange (forex) market saw the naira lose weight at the parallel and Investors and Export (I&E) windows. It however remain muted at Central Bank of Nigeria (CBN) spot market.
A the Parnell market, the shed N4 or 400 kobo to close the week at N482/$, while it depreciated 25 kobo to close at N410.25/$ at the I&E market.
It remained stable at N379/$ at the spot market.
This is as the central bank governor, Godwin Emefiele said weekend that the naira has depreciated to N410/$ at the official market.
He said, the Federal Government (FG) is taking a drastic step in ensuring increase in exports to boost dollar supply.
“In order to adjust decrease in supply of foreign exchange,the naira depreciated at the foreign from N305/$. To N360/$ and now hovers around N410/$”, he said.
Activity level in I&E Window surged last week 92.8 per cent to $498.8 million from $258.6 million recorded in the previous week.
This is spite the fact crude oil prices inched higher last week with the benchmark Brent crude up by 6.7 per cent week-on-week (w/w) to $66.28/bbl. despite concerns about increasing supply. On the domestic front, the external reserves declined marginally by 1.0 per cent w/w to $35.2 billion.
The total value of open contracts of the naira at the FMDQ Securities Exchange (SE) FX Futures Contract Market fell 20.0 per cent ($1.5 billion) to $6.0 billion as the FEB 2021 instrument (with a value of $1.6 billion) matured during the week. The FEB 2022 instrument (contract price: N435.58) received the highest subscription of $175.5 million which took total value to $292.9 million.
On the other hand, the DEC 2021 instrument (contract price: N432.58) recorded sell-offs totaling $82.1 million depleting total value to $333.3 million.
“We expect the exchange rates to remain range-bound at the various markets this week”, said analysts at Afrinvest.
Last week, the Open Buy Back (OBB) and Overnight (OVN) rates opened the week lower at 15.0 per cent and 15.3 per cent respectively from last week’s close of 20.0 per cent and 20.5 per cent as system liquidity settled at N80.8 billion.
