In the just concluded week, Naira depreciated against the USD at the Investors and Exporters window as the exchange rate rose by 0.52% to settle at N396.17/USD amid dwindling external reserves which fell w-o-w by 0.76% to USD36.12 billion as at Wednesday, February 3, 2021.
Also, Naira weakened against the USD at the Bureau De Change market by 0.21% to close at N474.00/USD. However, NGN/USD closed flat at N380.69/USD at the Interbank Foreign Exchange market amid weekly injections of USD210 million by CBN into the forex market: USD100 million was allocated to Wholesale Secondary Market Intervention Sales (SMIS), USD55 million was allocated to Small and Medium Scale Enterprises and USD55 million was sold for invisibles.
Also, Naira remain unchanged against the greenback at N480/USD at the parallel (‘black’) market.
Elsewhere, the Naira/USD exchange rate rose for most of the foreign exchange forward contracts: 1 month, 2 months, 3 months, 6 months and 12 months rates rose by 1.44%, 2.00%, 2.17%, 2.05% and 2.06% respectively to close at N405.62/USD, N411.90/USD, N416.27/USD, N427.30/USD and N445.65/USD respectively.
However, the spot rate remained flattish at N379.00/USD.
In the new week, we expect Naira/USD to stabilize at the I&E FX Window as the price of Nigeria’s crude oil grade Bonny light is expected to remain relatively high amid reports that OPEC+ maintained its production cut.