Wednesday, 1st September 2021: The exchange rate between the naira and the US dollar closed at N411.50/$1 at the Investors and Exporters window, where forex is traded officially.
Naira depreciated against the US dollar to close at N411.50/$1 on Wednesday, representing a 42 kobo drop when compared to N411.08/$1 recorded at the close of trading on Tuesday, 31st August 2021.
Also, the naira hit a new record low, depreciating against the dollar at the parallel market, as it closed at N528/$1 on Wednesday, 1st September 2021, representing a N2 drop when compared to N526/$1 recorded on the previous trading day.
The naira fell against the dollar across the forex markets with demand pressure, despite the dollar supply of $486.31 million at the official market, representing a 570.8% increase in forex liquidity.
The local currency has been hitting new lows at the black market since the CBN’s decision to channel demand from the unofficial market.
Trading at the official NAFEX window
The naira depreciated against the US dollar on Wednesday, 1st September 2021 to close at N411.50 to a dollar, representing a 0.1% loss when compared to N411.08/$1 recorded on the previous trading day.
The opening indicative rate closed at N411.58/$1 on Wednesday, September 1, as against N412.04/$1 recorded on Monday, representing a 46 kobo appreciation.
An exchange rate of N413 to a dollar was the highest rate recorded during intra-day trading before it settled at N411.50/$1, while it sold for as low as N400/$1 during intra-day trading.
Meanwhile, forex turnover at the Investors and Exporters (I&E) window rose significantly by 570.8% on Wednesday, 1st September 2021.
According to data from FMDQ, forex turnover increased from $72.50 million recorded on Tuesday to $486.31 million on Wednesday, 1st September 2021.
Cryptocurrency watch
The world’s most popular and largest cryptocurrency, Bitcoin, was up by 4.17% on Wednesday evening to trade at $48,752, as the leading digital asset has consolidated between $47,000 and $50,000 in the past few weeks.
Bitcoin has staged a major price recovery in recent weeks, but it is the market movements of several of its rivals that have proved the most noteworthy.
Cardano (ada), Solana and Hex have all hit record highs in recent days, amid a crypto bull run that has taken the combined market cap above $2.1 trillion for the first time since May.
Other major cryptocurrencies have also seen significant gains, with Ethereum (ether) rising by 6% over the last 24 hours and nearly 15% over the last seven days.
The world’s second-largest cryptocurrency was recently trading at $3,793.21, up by 11.72% over the past 24 hours.
Crude oil price
Brent crude oil was down by 0.06%, early on Wednesday evening to trade at $71.59 per barrel as OPEC decides to stand firm on its production plan, thereby sticking to its decision of increasing production.
OPEC+ kept the output plans unchanged, ignoring US President Joe Biden, who last month, in stark contrast to his energy transition agenda, called on OPEC to boost production by more than the agreed 400,000 bpd monthly to mitigate the effect of rebounding fuel demand on prices at the pump.
The previous and current plan is for the group to add 400,000 barrels per day in output for its members in October. Future plans include an additional 400,000 barrels per day added back into the production quotas each month, until the entire production cut is rolled back in May 2022.
The West Texas Intermediate (WTI) was down by 0.71% to close at $68.10 per barrel on Wednesday evening, after dropping the previous day.
Natural gas was down by 0.43% to trade at $4,595, Bonny Light Crude closed the day on a negative note as it dropped by 1.68% to trade at $69.44, while OPEC Basket was up by 1.03% to close at $71.48.
External reserve
Nigeria’s foreign reserve rose by $85 million as it recorded its fifth increase in over 2 weeks to close at $34.018 billion on Tuesday, 31th August 2021, compared to $33.933 billion recorded as of the previous day. The latest increase represents a 0.25% boost in the country’s foreign reserve.
In the same vein, the reserve level has also gained $615 million month-to-date compared to $33.403 billion recorded as of the beginning of the month.
However, its year-to-date change shows a $1.535 billion loss compared to $35.37 billion recorded as of 31st December 2021.
While recent reports have suggested that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021, the recent decline in the external reserve could be attributed to the decline recorded in the global crude oil market in recent weeks.
