Naira Sees 3.3% Gain as FX Market Condition Improves

The naira strengthened by 3.3% to close at N1,354.21 per US dollar at Nigeria’s autonomous foreign exchange market on Monday. The local currency recorded a gain against the dominant US dollar as the gap between supply and demand for foreign exchange closed favourably.

A slew of currency traders have reported that the demand for foreign exchange has decreased in comparison to the previous few weeks. The Central Bank of Nigeria’s (CBN) fx injection into the currency market declined significantly in April, the FMDQ Securities Exchange stated in its monthly update.

The reduced FX supply by the apex bank dragged total supply from the domestic side downward, along with a slide reported by non-bank corporate entities. Data obtained from the official trading platform of the FMDQ Exchange showed that the naira gained N46.19 following a steep decline in forex market liquidity in April.

This represents a 3.29 percent gain from N1,400.40 to the US dollar exchange rate quoted at the official window on Friday. However, the total daily turnover dropped from Friday’s recorded 201.88 million dollars to 84.83 million dollars.

Meanwhile, at the Investor’s and Exporter’s (I&E) window, the Naira traded between N1,441 and N1,285 against the US dollar. The naira closed at ₦1,415 at the parallel market as a result of demand constraints. The spot rate quoted remained higher than the CBN-determined rate based on the FX spreadcap placed on currency sold to the Bureau de Change operators (BDCs) at N1,021 at the last auction.

In the global commodity market, oil prices experienced an increase, with Brent crude rising by 0.62% to trade at $83.47 per barrel, and West Texas Intermediate (WTI) crude oil also advancing by 0.77% to trade at $78.71 per barrel #Naira Sees 3.3% Gain as FX Market Condition Improves Nigerian Banks Give Fresh Update
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