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Naira Closes Flat on Lower Demand for Dollar

By Dipo Olowookere

Amid relatively lower demand for the United States Dollar from businesses just resuming fully from the public holidays, the Naira closed flat at most segments of the foreign exchange (forex) market last week.

Also, the sustained intervention by the Central Bank of Nigeria (CBN) during week contributed to this.

At the close of business on Friday, the local currency closed against Dollar at N359/$ and N363/$ at the Bureau De Change (BDC) and parallel (black) market segments respectively.

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Also, the Naira/Dollar exchange rate remained stable at the interbank window of forex market, closing at N358.31/$.

In the week, the apex bank released the sum of $210 million into the market via the Secondary Market Intervention Sales (SMIS).

A breakdown of the release showed that $100 million was allocated to Wholesale SMIS, $55 million was allocated to Small and Medium Scale Enterprises and another $55 million was sold for invisibles to cater for medical, school fees, BTA and others.

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However, the local currency appreciated at the Investors & Exporters Forex Window (I&E FXW) by 0.11 percent to close at N364.94.

Meanwhile, according to Cowry Asset, the Naira/Dollar exchange rate fell (i.e. Naira appreciated) for most of the foreign exchange forward contracts – spot rate, 1 month, 2 months and 3 months rates moderated by 0.02 percent, 0.15 percent, 0.16 percent and 0.13 percent respectively to close at N306.90/$, N368.83/$, N372.10/$ and N374.74/$ respectively.

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However, 6 months and 12 months rates depreciated by 0.20 percent and 0.14 percent to N387.33/$ and N416.01/$ respectively.

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Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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