Economy

The Gains of Investors’ and Exporters’ (I&E) FX Window

Published

9 years ago

25/08/2017

The implementation of the Investors’ and Exporters’ Foreign Exchange (FX) Window has increased the supply of foreign exchange into the Nigerian economy.

In addition, it has attracted more investments into Nigeria. Consequently, we observed relative stability in the foreign exchange market. Companies and individuals are now able to access more foreign exchange in the market than before to carry out eligible transactions and economic activities are gradually picking up.

The Central Bank of Nigeria (CBN) introduced the special window for investors, exporters and end-users of FX on April 21, 2017 as part of its efforts to deepen the FX market and accommodate all the FX obligations.

According to the CBN, the objective of the window is to increase liquidity in the FX market and ensure timely execution and settlement of eligible transactions. The eligible transactions in the window are: 1) Invisible transactions such as loan repayment, capital repatriation, management services fees, consultancy fees, software subscription, technology transfer agreements, personal home remittances and any other eligible invisible transactions. 2) Bills for Collection 3) Any other trade-related obligations (at the instance of the customers).

The CBN stipulates that the supply of foreign currency to the window shall be through portfolio investors, exporters, authorized dealers and other parties with foreign currency to exchange to Naira. The CBN is also a market participant in the window to promote liquidity and professional market conducts.

As at August 11, 2017 the total turnover in the I&E FX window stood at US$7.62bn. Our monthly analysis of the turnover shows that it increased consistently from US$0.61bn in April 2017 to US$2.17bn in July 2017.

At US$1.7bn as of August 11, 2017, there are indications that the turnover in August 2017 will be higher than the July 2017 turnover. The introduction of the window has encouraged exporters to bring back their export proceeds to the country and through the official sources, thus increasing the stock of foreign exchange in the country.

Another important gain of the window is that it has attracted more foreign capital into Nigeria for various forms of investment. Our analysis of the capital importation data from the CBN between January and May, 2017 shows that there was a growth in capital importation in 2017 compared with 2016.

The total capital importation in the five months ended May 2017 stood at US$2.09bn representing a growth of 82.78% compared with the US$1.42bn recorded in the corresponding period of 2016. Other Investments (OI) – Loans attracted the highest capital of US$886mn between January and May in 2017, followed by Foreign Direct Investment (FDI) – Equity of US$436mn and closely followed by

Foreign Portfolio Investment (FPI) – Equity of US$413mn.

We also observed that the capital imported into Nigeria increased significantly from US$244mn in March to US$563mn in April 2017 following the commencement of the programme. The increased supply of FX led to an appreciation in the value of the Naira.

In the parallel market, the value of the Naira appreciated by 7.87% from N396/US$ on April 25, 2017 to N367.50/US$ as at August 11, 2017. At the I&E window, the Naira gained 2.82% from N374.96/US$ on April 25, 2017 to N364.78/US$ as at August 11, 2017. In the inter-bank market it also gained 0.1% from N305.9/US$ on April 25, 2017 to N305.65/US$ on August 11, 2017. The 30-day moving average external reserves also appreciated by 1.95% during the period while the equity market appreciated by 40.66% during the same period.

The manufacturing and non-manufacturing purchasing managers’ indices appreciated by 5.9% and 9.9% respectively during the period. All these leading indicators show the improved performance of the Nigerian economy during the period.

Although we commend the initiative and note the gains the Nigerian economy recorded since its implementation, we believe that the gains could be short-lived in the absence of complementary measures that will improve the competitiveness of the Nigerian economy.

There is the need for concerted efforts to improve physical and human infrastructure in order to increase local production to meet local consumption and boost exports to generate diversified foreign exchange earnings.

Economy

CSCS, Afriland Properties, MRS Oil Weaken NASD Exchange by 1.12%

Published

2 minutes ago

09/04/2026

Adedapo Adesanya

By Adedapo Adesanya

Three stocks further weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.12 per cent on Wednesday, April 8, with the Unlisted Security Index (NSI) down by 44.43 points to 3,930.91 points from the previous day’s 3,975.34 points, and the market capitalisation went down by N26.59 to N2.351 trillion from N2.378 trillion.

MRS Oil lost N11.00 during the session to close at N161.00 per share compared with Tuesday’s closing price of N172.00 per share, Central Securities Clearing System (CSCS) Plc dipped by N3.74 to N67.95 per unit from N71.69 per unit, and Afriland Properties Plc fell by N1.10 to sell at N15.95 per share versus N17.05 per share.

There were two gainers at the midweek trading session, led by IPWA Plc, which appreciated by 55 Kobo to N6.61 per unit from N6.06 per unit, and First Trust Mortgage Bank Plc improved its value by 4 Kobo to N2.32 per share from N2.28 per share.

Yesterday, the volume of securities rose by 620.4 per cent to 5.7 million units from 797,264 units, the value of securities increased by 25.1 per cent to N32.7 million from N26.1 million, and the number of deals climbed by 12.1 per cent to 37 deals from the preceding session’s 33 deals.

Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis with 3.4 billion units sold for N8.4 billion, trailed by CSCS Plc with 57.2 million units exchanged for N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.

GNI Plc also finished the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Resourcery Plc with 1.1 billion units worth N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.

Economy

Naira Grows 1.07% to N1,371/$1 at Official Market as FX Pressure Eases

Published

24 minutes ago

09/04/2026

Adedapo Adesanya

By Adedapo Adesanya

Foreign Exchange (FX) demand pressure eased on the Naira on Wednesday, April 8, in the Nigerian Autonomous Foreign Exchange Market (NAFEX) after gaining N14.84 or 1.07 per cent against the greenback to quote at N1,371.82/$1 compared with the previous day’s N1,386.66/$1.

Also, the local currency appreciated against the Euro in the same market window at midweek by N1.54 to close at N1,604.07/€1 versus Tuesday’s closing rate of N1,605.61/€1, but lost N6.26 against the Pound Sterling to trade at N1,844.83/£1 versus N1,838.57/£1.

In the parallel market, the exchange rate of the Naira to the US Dollar remained unchanged yesterday at N1,410/$1, according to data sourced by Business Post.

There were indicators that the official FX market experienced a liquidity surge, which eased worries around the dominant US Dollar on Wednesday, as the Central Bank of Nigeria (CBN) revealed interbank deals rose to 220 from 71 reported the previous day.

The domestic currency has been in strong demand from foreign portfolio investors seeking to purchase OMO bills and other fixed-income instruments.

Forecasts also show that the local currency will remain relatively stable during the second quarter of the year, trading within the N1,340 to N1,430 per Dollar band on improved FX liquidity, stronger oil earnings, and rising external reserves, which have climbed above 50 billion dollars.

As for the cryptocurrency market, it fell after an initial ceasefire-fueled rally, with markets retracing Wednesday’s “ceasefire euphoria” as cracks emerge in the US-Iran truce while the Strait of Hormuz remains effectively closed.

Global risk assets face renewed pressure as geopolitical uncertainty combines with what analysts call “uncoordinated tightening” by major central banks, reinforcing higher-for-longer interest-rate expectations.

The price of Cardano (ADA) fell by 4.7 per cent to $0.2500, Ripple (XRP) slumped 3.7 per cent to $1.33, Dogecoin (DOGE) shrank by 3.5 per cent to $0.0915, Binance Coin (BNB) slipped 2.6 per cent to $600.02, Ethereum (ETH) went down by 2.5 per cent to $2,183.82, Solana (SOL) dipped 2.5 per cent to $82.24, and Bitcoin (BTC) depreciated by 1.1 per cent to $70,995.20.

However, TRON (TRX) appreciated by 0.4 per cent to $0.3173, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.

Economy

Customs Street Surges 0.28% Despite Persistent Weak Sentiment

Published

1 hour ago

09/04/2026

Dipo Olowookere

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited rallied by 0.28 per cent on Wednesday despite weak investor sentiment, as the bourse ended with 18 price gainers and 38 price losers, implying a negative market breadth index.

The growth recorded yesterday by Customs Street was influenced by the 2.11 per cent rise posted by the energy index, and the 1.79 per cent jump achieved by the banking sector.

The other sectors experienced profit-taking, with the consumer goods losing 1.07 per cent, the insurance counter down by 0.36 per cent, and the industrial goods space down by 0.19 per cent.

Universal Insurance chalked up 10.00 per cent to sell for N1.21, Omatek improved by 9.78 per cent to N2.47, VFD Group expanded by 9.71 per cent to N11.30, CWG appreciated by 9.64 per cent to N21.05, and Livestock Feeds gained 9.56 per cent to close at N7.45.

On the flip side, UPDC REIT lost 10.00 per cent to settle at N6.75, Fortis Global Insurance shed 9.92 per cent to quote at N1.18, Deap Capital depreciated by 9.85 per cent to N5.40, Chams went down by 9.47 per cent to N3.06, and Japaul declined by 8.82 per cent to N3.10.

Yesterday, the All-Share Index (ASI) went up by 562.43 points to 202,585.53 points from 202,023.10 points, and the market capitalisation advanced by N389 billion to N130.404 trillion from N130.015 trillion.

During the session, 1.0 billion stocks worth N40.6 billion exchanged hands in 52,723 deals compared with the 1.1 billion stocks valued at N40.3 billion executed in 78,006 deals a day earlier, indicating an uptick in the trading value by 0.74 per cent, and a shortfall in the trading volume and number of deals by 9.09 per cent and 32.41 per cent apiece.

The activity chart was led by Access Holdings, which sold 233.0 million units valued at N6.1 billion, Fidelity Bank exchanged 113.1 million units worth N2.2 billion, Wema Bank recorded a turnover of 103.3 million units valued at N2.7 billion, Zenith Bank transacted 60.6 million units for N6.5 billion, and Chams traded 47.5 million units worth N154.6 million.