Tuesday, 15th February 2022: The exchange rate between the naira and the US dollar closed at N416/$1 at the Investors and Exporters (I&E) window, where forex is traded officially.
Naira appreciated marginally by 0.16% to close at N416 on Tuesday, 15th February 2022 compared to N416.67/$1 recorded in the previous session. This is despite the 22.9% increase in dollar demand at the official forex market.
The exchange rate at the Peer-to-Peer (P2P) forex market appreciated by 0.17% to trade at a minimum of N575 to a dollar on Wednesday morning compared to N576/$1 recorded on Tuesday, 15th February 2022.
On the other hand, Naira remained flat at the parallel market, closing at N570/$1 on Tuesday, 15th February 2022. This is according to information obtained from BDC operators interviewed by Nairametrics.
Also, Nigeria’s external reserve dropped further on Monday, 14th February 2022 to close at $39.79 billion representing a 0.14% decline compared to $39.79 billion recorded as of the previous day. The reserve continues despite the upward trend in the price of crude oil.
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Trading at the official NAFEX window
The exchange rate at the Investors and Exporters window closed at N416/$1 on Tuesday, 15th February 2022, which represents a 0.16% appreciation compared to N416.67/$1 recorded in the previous trading session
- The opening indicative rate closed to N415.5/$1 on Tuesday, which is 22 kobo lower than the N415.76/$1 recorded on Monday’s session.
- An exchange rate of N444.4/$1 was the highest rate recorded during intra-day trading before it settled at N416/$1, while it sold for as low as N410/$1 during intra-day trading,
- Meanwhile, forex turnover at the official window increased by 23.9% to $95.17 million on Tuesday.
- According to data tracked by Nairametrics from FMDQ, forex turnover at the I&E window increased to $95.17 million on Tuesday from $76.78 million recorded on Monday 14th February 2022.
The crypto market resumed trading activities on Wednesday, with an 18.7 billion decline in the industry market capitalization occasioned by the 1.03% decrease in the price of bitcoin to trade at $44,146.15, while Ethereum dipped by 1.36% to trade at $3,144.1.
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In the same vein, Solana declined by 1.05% to trade at $104.475, Terra dipped 0.42% to trade at $56.628, while Uniswap recorded a 2.53% decline to trade at $11.19.
DBS, the largest bank in Southeast Asia by assets, is set to launch cryptocurrency trading services for retail clients this year. The CEO of the bank, Piyush Gupta stated this during the bank’s Q4 earnings call on Monday.
Crude oil price
The crude oil market resumed trading activities on Wednesday morning on a positive note, following the downtrend recorded on Tuesday, falling to $93.28 per barrel at the close of trading activities on Tuesday, 15th February 2022.
However, as of press time on Wednesday morning, Brent Crude has gained 0.51% to trade at $93.76 per barrel, while American oil benchmark, WTI gained 0.54% to trade at $92.57 a barrel. Also, Natural Gas gained 3.55% on Wednesday morning to trade at $4.459 per barrel.
The market had remained bullish in recent weeks owing to sustained tension between Russia and Ukraine. Meanwhile, the foreign minister of Ukraine, Dmytro Kuleba said that Russia had ignored formal requests to explain the build-up of 100,000 soldiers on Ukraine’s borders. Although, Russia had denied any plans to invade Ukraine despite the build-up of troops at the border, according to BBC.
Meanwhile, the price of OPEC Basket declined marginally by 0.02% to trade at $92.85 per barrel, five days ago, While Bonny Light dipped 2.29% to close at $93.77 a barrel. Nigeria’s crude products, Brass River and Qua Iboe appreciated with a 0.34% appreciation to close at $99.08 per barrel.
Nigeria’s external reserve declined by 0.14% on Monday, 14th February 2022 to close at $39.7 billion, which represents a decline of $53.94 million from the $39.85 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. Although it is worth noting that the decline has been very minimal in recent times, largely attributable to the rally in crude oil prices.
Nigeria’s reserve level declined by $481.37 million in January 2022 following the $66.17 million depreciation recorded in the previous month. Meanwhile, year-to-date, Nigeria’s reserve has now depreciated by $725.39 million despite the rally at the global crude oil market.