Monday, 29th November 2021: The exchange rate between the naira and the US dollar closed at N415.07/$1, at the official Investors and Exporters (I&E) window.
Naira closed flat against the US dollar on Monday at N415.07/$1, the same as recorded in the past three trading sessions. This is despite trading as high as N456.97 during intra-day session. FOREX liquidity at the official market continues to improve as it increased by 19.1% to $256.69 million from $215.47 million recorded in the previous day.
Meanwhile, the naira depreciated against the US dollar on Monday to close at N569/$1 from N560/$1 that was recorded in the previous trading session. This is according to information obtained from BDC operators interviewed by Nairametrics.
Nigeria’s foreign reserve dropped yet again by 0.05% on Friday, 26th November to close at $41.28 billion compared to $41.3 billion recorded as of the previous day. The recent decline in the nation’s external reserve is attributed to the intervention by the apex bank in the official forex market.
Trading at the official NAFEX window
The exchange rate at the Investors and Exporters window closed flat on Monday at N415.07/$1, the same as recorded in the past three days. Meanwhile, it had depreciated earlier in the previous week from N414.8/$1 recorded on Tuesday to close at N415.07/$1 but has since maintained the same rate.
- The opening indicative rate closed at N413.75/$1 on Monday, which represents a 4 kobo fall compared to N413.71/$1 recorded in the previous trading session.
- An exchange rate of N456 to a dollar was the highest rate recorded during intra-day trading before it settled at N415.07/$1, while it sold for as low as N404/$1 during intra-day trading. It is worth noting that the N456.97/$1 is the highest rate on record at the Investors and Exporters window.
- Forex turnover at the official window increased by 19.1% to $256.69 million on Monday.
- According to data tracked by Nairametrics from FMDQ, forex turnover at the I&E window increased from $215.47 million recorded on Friday 26th November 2021 to $256.69 million on Monday 27th November 2021.
Bearish sentiments continue to affect the cryptocurrency market, as the market capitalisation has lost 1.75% to stand at $2.533 trillion as of 7:10 am on Tuesday. This was triggered by large sell-offs in bitcoins, which had dipped 2.21% to trade at $56,567.
Similarly, Ethereum dipped 0.63% to trade at $4,420.49, while Solana recorded a dip of 0.5% to trade at $203.1375.
Meanwhile, Jack Dorsey, the CEO of Twitter and a bitcoin enthusiast is set to step down from his position at Twitter. The businessman who has been known as one of the most ardent proponents of bitcoin, who also implemented a bitcoin tipping service on Twitter, will now step down from his role and to be replaced by Parag Agrawal.
Crude oil price falls to record low
The crude oil market is affected by the new strain of the covid-19 disease has recorded significant bearish trades as Brent dipped by 2.49% in the early hours of Tuesday, 30th November 2021 to trade at $71.01 per barrel as of the time of writing this article.
In a similar manner, West Texas Intermediate dipped by 3.39% to trade by $67.58 per barrel, falling from its highs that have been around the $80 per barrel in the past month. The price of Natural gas also plummeted to $4.716, representing a decline of 2.84%.
The market, which had been non-reactive to the announcement by the US government to release 50 million barrels of oil from its strategic reserve, in a bid to drive the surging price of gasoline down. However, with the new strain of the virus that has proven to be vaccine resistant, crude prices saw significant downturn in the previous week.
The global market now turns to the OPEC+ meeting to see if the cartel will continue with its planned 400,000 supply increase into the market or react based on Joe Biden’s crude release or the new strain of the covid.
OPEC basket has also contracted by 6.42% to trade at $76.09, while Nigerian crude Bonny Crude which currently trades at $73.52 per barrel gained 2.04% as of press time. On the other hand, Brass River and Qua Iboe both lost 5.73% to trade at $74.84 per barrel.
Nigeria’s external reserve dipped by 0.05% on Friday, 26th November 2021 to close at $41.28 billion, which represents a decline of $21.28 million compared to $41.3 billion recorded as of the previous day.
The decline in the country’s reserve level can be attributed to the continuous intervention of the apex bank in ensuring the stability of the exchange rate. The exchange rate at the official window as remained stable in the past four trading sessions.
It is worth noting that the nation’s foreign reserve had gained $5.99 billion in the month of October, as a result of the $4 billion raised by the federal government from the issuance of Eurobond in the international debt market.
The gains recorded in the previous month is higher than the $2.76 billion gain recorded in the month of September 2021. Meanwhile, Nigeria’s reserve has now recorded a decline of $549.5 million so far in the month of November, while on a year-to-date basis, the reserves have gained $5.91 billion.