Economy

Naira to Appreciate This Week Amidst Drop in Reserves, FPIs Inflows

Published

6 years ago

30/09/2019

By Modupe Gbadeyanka

There are strong indications that the Naira will appreciate at the foreign exchange (forex) market this week, analysts at Cowry Asset and Business Post have predicted.

According to Business Post analysts, the domestic currency will record a marginal gain against the Dollar in the four-day trading week despite the expected decline in the nation’s external reserves.

As at last Wednesday, data sourced from the Central Bank of Nigeria (CBN) by Business Post showed that the reserves were at $42.1 billion from $42.2 billion in the previous day.

From our analysis, the local currency will get an unusual strength from the easing of pressure from the demand of FX from investors as well as exporters at their market segment.

In the past few days, Business Post has observed lower demand for the foreign currency at the I&E window as shown by the FMDQ, a platform which gives update on the daily turnover at the market.

Last Tuesday, the Naira depreciated after market demand for FX rose by 37 percent to trade at N362.29/$, and the next day, a 35.8 percent decline in the turnover left the local currency flat at N362.29/$.

On Thursday, the Naira lost 29 kobo to trade at N362.58/$ despite a marginal 9.2 percent drop in demand for FX at the I$E segment. But on Friday, the Naira appreciated to N362.02/$1 after gaining 56 kobo on 59.4 percent decline in the market turnover for the third straight session.

It was observed that the decrease in the turnover is attributed to the inflow of forex into the country from foreign portfolio investors, who are finding Nigerian markets attractive again especially with the low prices stocks are being traded at the Nigerian Stock Exchange (NSE) as well as rising yields of bonds and treasury bills.

This point was buttressed by analysts at Cowry Asset, who said, “In the new week, we expect appreciation of the Naira against the USD across the market segments as seemingly renewed interest by foreign portfolio investors in local financial assets is further felt amid rate cut in US.”

Last week, Naira appreciated at the I&E to close at N362.02/$, but traded flat at the Bureau De Change as well as the parallel (black) markets, closing at N358.00/$ and N360.00/$ respectively.

Also, at the interbank segment, the domestic currency depreciated to N358.13/$ despite the weekly injections of $210 million by the CBN into the FX market via the Secondary Market Intervention Sales (SMIS).

In the intervention, the apex bank allocated $100 million to Wholesale SMIS, $55 million to Small and Medium Scale Enterprises and another $55 million for invisibles.

Meanwhile, the Naira/USD exchange rate fell (i.e. Naira appreciated) for most of the foreign exchange forward contracts – one month, 2 months, 3 months, 6 months and 12 months rates fell by 0.11 percent, 0.09 percent, 0.03 percent, 0.26 percent and 0.42 percent to close at N365.31/$, N368.73/$, N372.28/$, N382.97/$ and N409.45/$ respectively. However, spot rate was flattish at N306.95/$.

Economy

Customs Street Posts Modest Gain of 0.12% as Investors Recalibrate Portfolios

Published

1 hour ago

13/08/2025

Dipo Olowookere

By Dipo Olowookere

A marginal gain of 0.12 per cent was recorded by the Nigerian Exchange (NGX) Limited on Tuesday as investors slowed their appetite for stocks as they recalibrated their portfolios for a mix of different equities and other asset classes like bonds, treasury bills and others.

However, the demand for shares in the insurance sector continued as the index grew by 9.12 per cent and was followed by the industrial goods space, which closed higher by 0.86 per cent.

But, the consumer goods industry depreciated by 0.47 per cent, the banking space lost 0.22 per cent, and the energy counter declined by 0.19 per cent.

The losses recorded by these three sectors could not pull down Customs Street yesterday, as the All-Share Index (ASI) gained 175.12 points to quote at 146,055.89 points compared with Monday’s 145,880.77 points and the market capitalisation added N111 billion to finish at N92,405 trillion versus the preceding session’s N92.294 trillion.

ABC Transport, Prestige Assurance, The Initiates, Coronation Insurance, and Champion Breweries chalked up 10.00 per cent each during the trading day to end at N4.95, N2.20, N14.52, N4.07, and N17.38, respectively.

However, Juli lost 10.00 per cent to sell for N9.00, Unilever Nigeria declined by 9.97 per cent to N71.30, Custodian Investment crashed by 9.58 per cent to N37.90, Academy Press slipped by 7.78 per cent to N8.30, and May and Baker gave up 7.69 per cent to trade at N18.00.

Business Post reports that the market breadth index was positive as there were 50 price gainers and 29 price losers, indicating a strong investor sentiment.

The activity chart was led by Lasaco Assurance with 107.2 million shares sold for N439.2 million, Japaul traded 106.9 million equities valued at N302.7 million, Sterling Holdings exchanged 97.8 million stocks worth N784.5 million, AIICO Insurance transacted 65.0 million shares for N273.4 million, and Access Holdings traded 61.1 million equities worth N1.7 billion.

At the close of business, investors bought and sold 1.3 billion stocks valued at N24.3 billion in 31,155 deals versus the 2.1 billion stocks worth N19.4 billion exchanged in 40,435 deals a day earlier, implying a decline trading volume and the number of deals by 38.10 per cent and 22.95 per cent, respective, and a rise in the trading value by 25.26 per cent.

Economy

CSCS, Three Others Weaken NASD Bourse by 1.46%

Published

2 hours ago

13/08/2025

Adedapo Adesanya

By Adedapo Adesanya

Four stocks pulled down the NASD Over-the-Counter (OTC) Securities Exchange by 1.46 per cent on Tuesday, August 12, a day after it welcomed a new member, MRS Oil Nigeria Plc.

At the bourse yesterday, the market capitalisation fell by N32.13 billion to close at N2.162 trillion compared with the previous day’s N2.194 trillion and the NASD Unlisted Security Index (NSI) depreciated by 53.70 points to settle at 3,614.69 points, in contrast to the 3,668.39 points it finished a day earlier.

According to the trading data, Central Securities Clearing System (CSCS) Plc went down by N5.30 to close at N48.20 per share compared with Monday’s closing price of N53.50 per share, FrieslandCampina Wamco Nigeria Plc crumbled by N1.55 to end at N66.84 per unit versus the previous session’s N68.39 per unit, Food Concepts Plc slid by 12 Kobo to N3.10 per share from N3.22 per share, and Geo-Fluids Plc fell by 1 Kobo to N4.99 per unit from N5.00 per unit.

Conversely, Industrial and General Insurance (IGI) Plc gained 4 Kobo to end at 48 Kobo per share compared with the preceding day’s 44 Kobo per share, and First Trust Mortgage Bank Plc appreciated by 1 Kobo to 63 Kobo per unit from 62 Kobo per unit.

During the session, the volume of securities soared by 4,137.5 per cent to 31.9 million units from 751,813 units, the value of securities surged by 981.5 per cent to N113.5 million from N10.5 million, while the number of deals went down by 7.5 per cent to 37 deals from 40 deals.

The most traded stock by value on a year-to-date basis remained Okitipupa Plc with 154.4 million units sold for N5.0 billion, trailed by Air Liquide Plc with 507.2 million units worth N4.2 billion, and FrieslandCampina Wamco Nigeria Plc with 43.8 million units traded for N1.9 billion.

IGI Plc also remained as the most traded stock by volume on a year-to-date basis with 1.1 billion units transacted for N367.9 million, followed by Impresit Bakolori Plc with 536.9 million units worth N524.8 million, and Air Liquide Plc with 507.2 million units valued at N4.2 billion.

Economy

Naira Falls to N1,537/$1 at NAFEM, Firms to N1,555/$1 at Black Market

Published

2 hours ago

13/08/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira weakened further against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Tuesday, August 12 amid renewed foreign exchange (FX) pressures.

At the official market yesterday, the local currency lost 0.1 per cent or N1.41 against the greenback to sell for N1,537.38/$1 compared with the preceding day’s N1,535.97/$1.

Equally, the domestic currency depreciated against the Pound Sterling at the spot market by N13.40 to settle at N2,073.54/£1, in contrast to Monday’s exchange rate of N2,060.14/£1 and against the Euro, it tumbled by N8.89 to close at N1,791.64/€1 versus the N1,782.75/€1 it was traded a day earlier.

However, in the black market, the Nigerian Naira gained N5 against the US Dollar on Tuesday to quote at N1,555/$1 compared with the preceding session’s rate of N1,560/$1.

Pressure came on the Nigerian currency yesterday as volatility in the oil market, particularly the recent downward trend in crude prices, have introduced headwinds to the nation’s reserves amid persistent FX injections by the Central Bank of Nigeria (CBN).

Despite the expected short-term pressure, there are anticipation that the Naira will hold relatively steady, especially at the official window, barring any major shocks in global commodity or financial markets.

As for the cryptocurrency market, there were gains as the US government suggested that there should be a considerable cut in interest rates, even though the decision rests with its central bank, the US Federal Reserve.

Treasury Secretary Scott Bessent suggested the Federal Reserve should consider a 50 basis point rate cut at its upcoming September meeting.

“The real thing now to think about is should we get a 50 basis-point rate cut in September,” Mr Bessent told Fox News. He added that the US Federal Reserve could have cut rates in June if it had been given accurate data, which he described as a “foundational issue” at the central bank.

This statement came as President Donald Trump is looking to replace the head of the central bank, Mr Jerome Powell, and since Mr Bessent was tasked with this; his words surely carry some weight.

Solana (SOL) increased by 12.9 per cent to $197.56, Litecoin (LTC) jumped by 11.3 per cent to $133.49, Cardano (ADA) rose by 9.2 per cent to $0.8449, and Ethereum (ETH) improved by 8.4 per cent to $4,652.43.

Further, Dogecoin (DOGE) gained 6.4 per cent to sell at $0.2382, Binance Coin (BNB) soared by 3.6 per cent to $837.39, Ripple (XRP) surged by 3.3 per cent to $3.24, and Bitcoin (BTC) appreciated by 0.7 per cent to $119,554.04, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.