Exchange rate falls at official market as dollar supply drops significantly

Monday, 20th September 2021: The exchange rate between the naira and the US dollar closed at N413.68/$1, at the official Investors and Exporters window.

Naira fell against the US dollar on Monday, to close at N413.68/$1, representing a 0.19% decline compared to N412.88/$1 recorded on Friday, 17th September 2021.

Similarly, the exchange rate at the parallel market closed at N570/$1 on Monday, representing a N10 depreciated compared to N560/$1 recorded in the previous week. This is according to information obtained from BDC operators by the Nairametrics team.

Nigeria’s foreign reserve gained $88.89 million on Friday, 17th September 2021 to close at $35.46 billion, according to data from the Central Bank of Nigeria. So far in the month of September, the CBN has recorded a total reserve gain of $1.44 billion.

READ: Naira continues unprecedented fall, hits N550/$1 at black market

Trading at the official NAFEX window

Exchange rate depreciated against the US dollar on Monday 20th September 2021 to close the day at N413.68 to a dollar, representing a 0.19% drop compared to N412.88/$1 recorded in the previous trading day.

The opening indicative rate closed at N412.81/$1 on Monday, representing a 32 kobo decline when compared to N412.49/$1 recorded on Friday, 17th September 2021.

An exchange rate of N415 to a dollar was the highest rate recorded during intra-day trading before it settled at N413.68/$1, while it sold for as low as N409/$1 during intra-day trading.

READ: Why is the Naira falling? 

Meanwhile, forex turnover at the Investors and Exporters (I&E) window decreased significantly by 60.3% on Monday, 20th September 2021.

According to data tracked by Nairametrics from FMDQ, forex turnover depreciated from $229.79 million recorded on Friday to $91.23 million on Monday 20th September 2021.

Cryptocurrency watch

The crypto market started Monday on a bearish note with a 0.5% decline to close at $1.9 trillion, representing a $10.47 billion loss. The industry’s capitalisation dropped below the $2 trillion threshold.

The world’s most popular crypto asset dipped 1.35% in the early hours of Monday to trade at $42,454.46. It dropped from as high as $47,000 which it closed at, on Sunday. Meanwhile, Ethereum dipped 0.1% to trade at $2,974.7 falling below $3,000. XRP gained 1.2% to trade at $0.933, it also fell from $1.07633 recorded on Sunday.

Recall that Nairametrics had reported that the President of El Salvador bought an additional 150 BTC. “They can never beat you if you buy the dips,” said El Salvador’s president, Nayib Bukele, as he announced that his country has “bought the dip” to the tune of 150 BTC. This puts El Salvador’s total BTC holdings at 700 BTC.

READ: Exchange rate: Is Nigeria better with a weak naira?

Crude oil price

Brent Crude started the day on a positive note gaining about 0.89% trading at $74.58 per barrel having dipped below $75 in the previous trading session. WTI Crude also gained 1.15% to trade at $71.1 per barrel as of 6:38 am on Tuesday.

The market witnessed a dip on Monday, as the U.S dollar continues to strengthen as traders wait for the outcome of the federal much-anticipated policy meeting this week, which could announce the beginning of stimulus.

According to oilprice.com, “the U.S. dollar and the Fed meeting will be the key external factors that will determine oil’s direction this week, apart from the usual U.S. inventory reports by the API and EIA, ING strategists Warren Patterson and Wenyu Yao say.”

External reserve

Nigeria’s foreign reserve gained $88.89 million on Friday, 17th September 2021 to close at $35.46 billion compared to $35.37 billion recorded as of the previous day. The latest increase represents a 0.25% boost in the country’s foreign reserve.

The reserve has now gained $1.44 billion in the month of September 2021, while the recent gain has cancelled out the year-to-date loss as it currently stands at a gain of $81.3 million.

The recent increase in the reserve position, which has continued for 16 consecutive days is in line with recent reports which had suggested that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021.

Disclaimer: Nairametrics does not set or determine forex rates. The official NAFEX rates are obtained from the website of the FMDQOTC. Parallel market rates are obtained from various sources including online media outlets. The rates you buy or sell forex may be different from what is captured in this article.