Thursday, 3rd February 2022: The exchange rate between the naira and the US dollar closed at N416.07/$1 at the official Investors and Exporters (I&E) window.
Naira appreciated marginally against the US dollar on Thursday with a 0.04% gain to close at N416.07/$1 compared to N416.25/$1 recorded as of the close of trading activities on Wednesday, 2nd February 2022.
On the other hand, the exchange rate depreciated at the Peer-to-Peer (P2P) forex market, trading at a minimum of N572.8 to a dollar on Friday morning compared to N569.9/$1 recorded in the previous trading session.
Highlights
Forex turnover at the official market surged by 59.4% to $162.7 million, which is the highest daily turnover at the official window in over 3 weeks.
- The exchange rate at the P2P market depreciated on Friday morning, trading at a minimum of N572.8/$1 compared to N569.9/$1 recorded on Thursday morning.
- Naira closed lower at N569/$1 at the parallel market, compared to N568/$1 recorded on Wednesday. This is according to information obtained from BDC operators interviewed by Nairametrics.
- Nigeria’s foreign reserve declined by $26.94 million on Wednesday to close at $39.98 billion as of 2nd February 2022, representing a 0.07% decline compared to $40.01 billion recorded as of 1st February.
Trading at the official NAFEX window
The exchange rate at the Investors and Exporters window closed at N416.07/$1 on Thursday, 3rd February 2022, which represents a 0.04% marginal appreciation compared to N416.25/$1 recorded in the previous trading session
- The opening indicative rate closed at N415.68/$1 on Thursday, which represents 11 kobo depreciation compared to N415.5/$1 recorded in the previous trading session.
- An exchange rate of N444/$1 was the highest rate recorded during intra-day trading before it settled at N416.07/$1, while it sold for as low as N408/$1 during intra-day trading.
- Forex turnover at the official window surged by 59.4% to $162.7 million on Thursday, 3rd February 2022.
- According to data tracked by Nairametrics from FMDQ, forex turnover at the I&E window increased from $102.07 million recorded on Wednesday 2nd February 2022 to $162.7 million on Thursday 3rd January 2022.
Cryptocurrency watch
The crypto market started the day on a positive note with $30 billion boost in the industry’s market capitalization, representing a 1.88% increase to stand at $1.73 trillion. Flagship crypto asset and the most valuable crypto, bitcoin also gained 1.51% to trade at $37,909.1.
Similarly, Ethereum gained 4.01% to trade at $2,805, while Solana with 3.29% gain traded at $105.2625 as of press time. Terra gained 0.33% and Uniswap gained 2.6% to trade at $51.2957 and $10.65 respectively.
Crude oil market
The crude oil market maintained a bullish stands as the price of brent crude oil increased by 0.3% in the early hours of Friday to trade at $91.38 per barrel, following the decision of the OPEC+ to stick to monthly increases of 400,000 barrels per day in output despite pressure from consumers to increase supply.
West Texas Intermediate in the same vein recorded a gain of 0.51% in price to trade at $90.73 per barrel, while Natural gas on the flip side dipped 0.2% to trade at $4.878 a barrel. The rally at the crude market can be attributed to the tight supply stance adopted by the oil-producing nations as well as geopolitical tensions, boosting crude prices over 10% year-to-date.
Bonny Light also gained 1.35% in price to close at $91.3 per barrel on Thursday, while Brass River and Qua Iboe, both Nigerian crude product dipped nu 0.46% to close at $90.92 per barrel.
External reserve
Nigeria’s external reserve dropped by 0.07% on Wednesday, 2nd February 2022 to close at $39.98 billion, which represents a decline of $26.94 million from the $40.01 billion recorded as of the previous day.
The continuous decline in the country’s reserve level can be attributed to the Central Bank’s intervention in the official market in ensuring the stability of the exchange rate and the inability of Nigeria to meet crude oil production quota.
It is worth noting that the nation’s foreign reserve 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.
Nigeria’s reserve level declined by $481.37 million in January 2022 following the $66.17 million dip recorded in the previous month. Year-to-date, Nigeria’s reserve has declined by $535.67 million despite the rally at the global crude oil market.