Naira Sheds 0.06% Against Dollar at I&E Amid 2% Rise Foreign Reserves

By Dipo Olowookere

Last week, the local currency declined week-on-week against the Dollar at the Investors and Exporters (I&E) forex window and the Bureau De Change (BDC) segments by 0.06 percent and 0.28 percent to close at N360.32 and N360 respectively.

This was in spite of the 2 percent w-o-w growth in the external reserves to $43.6 billion as at Thursday, March 8, 2018 and weekly injections by the Central Bank of Nigeria (CBN) worth $210 million into the foreign exchange market, of which $100 million was allocated to the Wholesale segment, and $55 million given to the Small and Medium Scale Enterprises, while the Invisibles sector received $55 million.

However, the Naira/Dollar rate remained unchanged at the interbank foreign exchange market and the parallel market segments at N330/$ and N362/$ respectively.

According to Cowry Asset, during the week, most dated forward contracts at the interbank over-the-counter segment depreciated.

The 1 month, 2 months, 3 months and 5 months contracts declined by 0.12 percent, 0.18 percent, 0.24 percent and 0.15 percent to close at N364.54/$, N368.99/$, N373.55/$ and N388.92/$ respectively.

However, the spot rate appreciated by 0.02 percent to close at N305.80/$.

This week, the Naira is expected to remain stable as global crude oil prices remain relatively high, which should result in further build-up in foreign reserves.