Adedapo Adesanya
By Adedapo Adesanya
The Nigerian Naira suffered a N1 or 0.17 per cent loss against the United States Dollar at the Peer-to-Peer (P2P) segment of the foreign exchange (FX) market on Thursday, closing at N587/$1 compared with the preceding day’s exchange rate of N586/$1.
This was caused by the strengthening of the greenback in the global market as the US Federal Reserve raised interest rates by 50 basis points, bringing the fed funds rate up from 0.5 per cent to 1 per cent.
This action by the Fed affected the cryptocurrency market yesterday as the bears had a field day, causing most of the cryptos tracked by Business Post across several trading platforms to lose value.
The US central bank’s policy-making committee said it will begin allowing its holdings of Treasuries and mortgage-backed securities to roll off in June.
Investors in digital coins reacted to this development and during the session, Cardano (ADA) plunged by 11.8 per cent to N476.51, Solana (SOL) recorded an 8.7 per cent depreciation to sell at N59,788.64, Litecoin (LTC) declined by 8.5 per cent to trade at N58,404.09, while Bitcoin (BTC) crashed by 8.4 per cent to N22,712,397.00.
In addition, Ripple (XRP) fell by 7.9 per cent to N359.71, Dash (DASH) slumped by 7.7 per cent to sell at N62,072.01, Ethereum (ETH) depreciated by 6.5 per cent to quote at N1,654,083, Binance Coin (BNB) recorded a 5.3 per cent slide to trade at N228,079.00, while Dogecoin (DOGE) dropped 5.1 per cent to exchange at N77.52.
But the United States Dollar Tether (USDT) appreciated on Thursday by 0.1 per cent to N648.01.
Meanwhile, a look at the performance of the Naira against the American currency at the Investors and Exporters (I&E) window of the forex market yesterday showed that it was woeful as it lost N1 or 0.24 per cent to close at N419.00/$1 compared with N418.00/$1 it ended on Wednesday.
Data from the FMDQ Securities Exchange indicated that the local currency reported the loss despite a decline in the day’s FX turnover by $54.46 or 33.5 per cent to $108.24 million from $162.70 million. A shortage of FX supply to traders may have been responsible for the weakening of the Naira during the session.
However, it was a different outcome at the interbank segment of the market, where the domestic currency appreciated against the Pound Sterling on Thursday by N4.03 to trade at N515.95/£1 compared to the previously traded rate of N519.98/£1.
But the Naira suffered a N1.36 loss against the Euro at the same market segment to wrap the day at 439.22/€1 in comparison to the preceding session’s N437.86/€1.
