Currencies
Naira falls across forex markets as CBN suggests official rate has been adjusted
The Naira depreciated against the US Dollar at the Investors and Exporters window on Friday closing at N410.25/$1.
The exchange rate between the naira and the US Dollar depreciated to close at N410.25/$1 at the Investors and Exporters (NAFEX) window, where forex is traded officially. This is as the CBN Governor has suggested that the official exchange rate has been devalued.
Similarly, at the parallel market where forex is traded unofficially, the naira depreciated closing at N482/$1 on Friday, February 26. This represents 0.42% drop when compared to the N480/$1 that it closed on the previous trading day.
However, forex turnover at the Investor and Exporters (I&E) window decreased by 79.3% from $212.43 million recorded on Wednesday to $43.97 million on Thursday 25th February 2021.
READ: Naira strengthens at NAFEX window despite 79.3% drop in dollar supply
Trading at the official NAFEX window
The Naira depreciated against the US Dollar at the Investors and Exporters window on Friday closing at N410.25/$1. This represents a 0.39% drop when compared to N408.67/$1 recorded on Thursday, February 25, 2021.
- The opening indicative rate closed at N409.24 to a dollar on Friday. This represents an 8 kobo drop when compared to N409.16/$1 recorded on Thursday.
- Also, an exchange rate of N415 to a dollar was the highest rate during intra-day trading before it closed at N410.25/$1. It also sold for as low as N392/$1 during intra-day trading.
- Forex turnover at the Investor and Exporters (I&E) window dropped by 14.7% on Friday, February 26, 2021.
- According to the data tracked by Nairametrics from FMDQ, forex turnover decreased from $43.97 million recorded on Thursday, February 25, 2021, to $37.49 million on Friday, February 26, 2021.
READ: World’s largest oil producer loses four million barrels per day
Cryptocurrency watch
The world’s largest cryptocurrency, Bitcoin, dropped 6.39% to close at $43,165.78 on Sunday, losing $2,944.20 from its previous close.
- Bitcoin has lost 26% from the year’s high of $58,354.14 on February 21, when it went up amid increasing confidence that it will become a mainstream investment and payments vehicle.
- A quick recap of bitcoin’s worst weekly performance since March 2020, shows that the week’s high volatility was not caused by one factor. It was largely triggered by an overheated derivatives market as traders rushed to exit leveraged bets that had accumulated.
- Further drops had coincided with a sell-off in the broader stock market due to rising concerns over surging bond yields, which might reduce the attraction for riskier assets like cryptocurrencies.
- Etherium dropped 8.88% to close at $1,329.46 on Sunday, losing $129.57 from its previous close.
- Meanwhile, Nigeria’s Vice President, Yemi Osibanjo, while disagreeing with the CBN on its recent ban on cryptocurrencies, called for crypto regulation knowing fully well the role it plays in the global financial ecosystem. Osibanjo advised CBN and SEC to create a regulatory road map for cryptocurrencies.
READ: How Nigeria can make more money from Oil?
Oil price dip marginally on account of pullbacks
Brent crude oil price closed at $64.42 per barrel, dropping $1.69, the WTI Crude closed at $61.50 per barrel, dropping $2.03, OPEC Basket closed at $65.42, gaining $1.42 while the Bonny Light closed at $64.33 per barrel, dropping $1.20.
- These forecasts have called for an increase in crude oil supply in response to prices climbing above the pre-pandemic level.
- Analysts are also expecting that next week’s meeting of OPEC and its allies will result in more supply returning to the market.
- U.S. crude oil production fell in December to an average 11.063 million barrels per day, when compared to the average of 12.8 million barrels per day that was achieved in December 2019, according to the Energy Information Administration’s latest monthly report.
- U.S. crude oil production fell an average of 58,000 barrels per day, the EIA said on Friday.
The steady decline in external reserves
Nigeria’s external has declined by 0.15% to stand at $35.17 billion as of February 24th 2021 compared to $35.23 recorded as of 23rd February.
- This indicates that Nigeria has lost a total of $1.13 billion in external reserve positive in the month of February.
- According to data obtained from the Central Bank of Nigeria (CBN), external reserves declined from $36.3 billion as of 29th of January 2021 to $35.17 billion as of 24th of February.
- It is however worth noting that the decline in Nigeria’s external reserve has persisted despite a sharp increase in global crude oil prices as it is currently over $64 per barrel from $55.04 recorded as at the end of January.
Currencies
Naira appreciates at NAFEX as Nigeria’s external reserve is set to get a boost
Naira gained against the US Dollar at the NAFEX window on Friday to close at N409/$1.
Friday, 9th April 2021: The exchange rate between Naira and the US Dollar closed at N409/1$ in the Importers and Exporters window, where forex is traded officially.
Naira gained against the US Dollar at the NAFEX window on Friday to close at N409/$1. This represents a 0.16% gain when compared to N409.65/$1 recorded on Thursday, as the country’s external reserve is set to receive a boost with the planned issuance of $500 million Eurobonds.
Meanwhile, the naira maintained stability at the parallel market on Friday, 9th April, 2021 to close at N485 to a dollar, the same rate as maintained since last week.
READ: Nigeria’s external reserve drop by $261 million in 15 days, oil firms to sell forex to CBN
Trading at the official NAFEX window
Naira appreciated against the US Dollar at the Investors and Exporters window on Friday to close at N409 to a dollar. This represents a 65 kobo gain when compared to N409.65/$1 recorded on Thursday, 8th April 2021.
- The opening indicative rate closed at N409.79 to a dollar on Friday. This represents a 71 kobo gain when compared to N410.50/$1 recorded on Thursday.
- Also, an exchange rate of N420 to a dollar was the highest rate recorded during intra-day trading before it closed at N409/$1. It also sold for as low as N395/$1 during intra-day trading.
- Forex turnover at the Investor and Exporters (I&E) window dropped by 41.1% on Friday, 9th April 2021.
- A cursory look at the data tracked by Nairametrics from FMDQ showed that forex turnover declined from $93.69 million recorded on Thursday, April 8, 2021, to $55.21 million on Friday, April 9, 2021.
READ: Naira gains at NAFEX as oil prices record biggest single day loss in 11 months
Cryptocurrency watch
The world’s most popular digital currency, bitcoin recorded a 3.05% increase in value on Saturday evening, 10th April 2021.
- Bitcoin went up by 3.05% to trade at $59,907 on Saturday evening, compared to $58,135 recorded at the close of trade on Friday.
- This is coming after it had risen to $61,222.22 on Saturday, its highest in nearly a month, propelled by talks of constrained new supplies against evidence of wider adoption.
- Bitcoin (BTC) is up 116% from the year’s low of $27,734 on January 4. It crossed the $60,000 mark for the first time on March 13, hitting a record $61,781.83 on Bitstamp exchange, just after U.S. President Joe Biden signed his $1.9 trillion fiscal stimulus package into law.
- The digital currency has been widely adopted by many, replacing gold as the global digital-reserve asset.
READ: Nigeria’s external reserve drop by $261 million in 15 days, oil firms to sell forex to CBN
Oil price gain
Brent crude oil price declined on Sunday evening as it closed at $63.02 per barrel, indicating a 0.28% drop compared to $63.2 recorded at the close of trade on Friday.
- This is as the fall in oil prices especially towards the end of last week can be attributed to demand concerns and Covid-19 lockdowns in some major economies, due to a spike in infections.
- The Russian government has said that the coronavirus pandemic could continue to impact on global oil demand until 2024.
- Crude oil prices had recorded a marginal increase during the week despite the decision of the OPEC+ to ease production cuts in the coming months. However, US Shale Giant has commended the OPEC+ group for bringing supply and demand back to balance.
- Brent Crude closed at $63.02 (+0.11%), WTI Crude closed at $59.39 indicating 0.12% gain, Bonny Light, $61.55 (+0.46%), OPEC Basket (+0.89%) to close at $61.22 while Natural gas gained 0.67% to close at $2.543.
External reserve
Nigeria’s external reserve gained $29 million on Thursday, 8th April 2021 to close at $35.006 billion, being the highest external reserve position recorded in over a month.
- This indicates a 0.08% increase when compared to $34.977 billion recorded on Wednesday, 7th April 2021.
- It also represents an increase in the country’s external reserve position for the 13th consecutive day, having endured a significant downturn earlier in the year. Nigeria’s reserve has added a total of about $590 million in 13 days.
- This recent increase in Nigeria’s external reserve could however be attributed to the increase in crude oil prices recorded earlier in March before the recent bearish trade in the crude market.
- It could be attributed to the possible increase in diaspora remittance as the CBN offers incentives for every unit of a dollar received in Nigeria from diaspora remittance.
- The external reserve is likely to get further boost as the Federal Government recently announced plans to issue $500 million Eurobonds for 2021.
Currencies
Exchange rate strengthens at NAFEX as dollar supply spikes by 690%
Naira gained against the US Dollar on Thursday to close at N409.65/$1 while dollar supply surges by 690.6%.
Thursday, 8th April 2021: The exchange rate between Naira and the US Dollar closed at N409.65/1$ in the Importers and Exporters window, where forex is traded officially.
Naira gained against the US Dollar on Thursday to close at N409.65/$1. This represents a 0.33% appreciation compared to N411/$1 recorded on Wednesday.
Meanwhile, naira remained stable in the parallel market on Thursday, 8th April 2021 to close at N485 to a dollar, the same rate as maintained since last week.
READ: Naira falls at NAFEX window despite 394% increase in dollar supply
Trading at the official NAFEX window
Naira appreciated against the US Dollar at the Investors and Exporters window on Thursday to close at N409.65 to a dollar. This represents a N1.35k gain when compared to N4111/$1 recorded on Wednesday, 7th April 2021.
- The opening indicative rate closed at N410.5 to a dollar on Thursday. This represents a N0.76 depreciation when compared to N409.74/$1 recorded on Wednesday.
- Also, an exchange rate of N419 to a dollar was the highest rate recorded during intra-day trading before it closed at N409.65/$1. It also sold for as low as N394/$1 during intra-day trading.
- Forex turnover at the Investor and Exporters (I&E) window increased by 690.6% on Thursday, 8th April 2021.
- A cursory look at the data tracked by Nairametrics from FMDQ showed that forex turnover grew from $11.85 million recorded on Wednesday, April 7, 2021, to $93.69 million on Thursday, April 8, 2021.
Cryptocurrency watch
The world’s most popular digital currency, bitcoin recorded a 0.18% decline in value in the early hours of Friday, 9th April 2021.
- Bitcoin was down by 0.18% to trade at $58,135 on Friday morning, bur lead compared to $36,199 recorded at the close of trade on Wednesday.
- Meanwhile, according to a research report, bitcoin is expected to surge around 600$ to hit the $400,000 level in 2021. This has been well met as major financial institutions in the world such as Visa, Goldman Sachs, and Morgan Stanley have embraced the digitalization of money.
- The digital currency has been widely adopted by many, replacing gold as the global digital-reserver asset.
READ: Naira remains flat as external reserve fall to just 6 months of imports
Oil price gain
Brent crude oil price recorded a marginal increase on Thursday as it closed at $63.2 per barrel, indicating a 0.06% gain compared to $63.16 recorded at the close of trade on Wednesday.
- Crude oil prices are beginning to record tepid growth demands are expected to increase due to revived optimism in the market as the United Kingdom has given the first vaccine to about half of its population, while the US has vaccinated about 30% of its population.
- Crude oil prices have recorded a marginal increase during the week despite the resolve of the OPEC+ to reduce production cuts in the coming months. However, US Shale Giant have commended the OPEC+ group in bringing supply and demand back to balance.
- Brent Crude closed at $63.2 (+0.06%), WTI Crude closed at $59.75 indicating 0.25% gain, Bonny Light, $60.6 (-2.63%), OPEC Basket (-1.06%) to close at $60.68 while Natural gas dipped by 0.12% to close at $2.519.
External reserve
Nigeria’s external reserve gained $1.79 million on Thursday, 8th April 2021 to close at $34.977 billion, being the highest external reserve position recorded in over a month.
- This indicates a 0.01% increase when compared to $34.975 billion recorded on Thursday 1st April 2021.
- This also represents an increase in the country’s external reserve position for the 12th consecutive day, having endured a significant downturn in the early parts of the year. Nigeria’s reserve has added a total of $560.5 million in 12 days.
- This recent increase in Nigeria’s external reserve could however be attributed to the increase in crude oil prices recorded earlier in March before the recent bearish trade in the crude market.
- It could be attributed to the possible increase in diaspora remittance as the CBN offers incentives for every unit of dollar received in Nigeria from diaspora remittance.
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