Naira Weakens 1.37% at Official Market as CBN Holds 297th MPC Meeting

By Adedapo Adesanya

Due to foreign exchange (FX) supply constraints, the Naira depreciated at the Nigerian Autonomous Foreign Exchange Market (NAFEM) against the United States Dollar by 1.37 per cent or N21.14 on Monday to sell for N1,562.66/$1 compared with last Friday’s N1,541.32/$1.

The loss coincided with the commencement of the 297th Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) yesterday.

Later on Tuesday, the Governor of the CBN, Mr Yemi Cardoso, is expected to announce the decision of the team regarding the Monetary Policy Rate (MPR).

Analysts expect the MPC to pause a rate hike after inflation cools down for two consecutive months.

Business Post reports that at the official forex market on Monday, the turnover went down by 47.4 per cent or $90.36 million to $100.21 million from $190.57 million.

However, the domestic currency appreciated against the British Pound Sterling during the trading day in the spot market by N40.77 to quote at N2,067.87/£1 versus the previous session’s N2,108.64/£1 and against the Euro, it improved its value by N10.18 to N1,762.43/€1 from last Friday’s rate of N1,772.61/€1.

The Naira is weakening as the central bank slows the pace of its interventions which it had commenced to stabilise the foreign exchange market after it had promised to address the supply gap to ensure market stability.

A look at the black market segment of the FX market showed that the Nigerian currency weakened against the greenback yesterday by N5 to trade at N1,665/$1 compared with the preceding trading day’s N1,660/$1.

As for the cryptocurrency market, it was majorly negative on Monday with investors and traders going on a profit-taking spree that led to benchmarked tokens ending southwards.

Out of the ten benchmarked tokens, only Cardano (ADA) and Binance Coin (BNB) gained 1.9 per cent and 1.3 per cent, respectively, to trade at $0.362 and $602.37.

Litecoin (LTC) recorded a 2.3 per cent loss to settle at $66.42, Ethereum (ETH) dropped by 0.9 per cent to $2,632.11, Ripple (XRP) also fell by 0.9 per cent to $0.5861, Bitcoin (BTC) shed 0.8 per cent to quote at $63,209.57,  Dogecoin (DOGE) lost 0.5 per cent to sell at $0.1075, Solana (SOL) slumped by 0.3 per cent to $146.26, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.