Market News

BY Tony Chukwunyem

The naira maintained its recent upward trend on Monday, appreciating to N1,506.84/$1 on the Nigerian Foreign Exchange Market (NFEM), compared with N1,514.87 per dollar last Thursday, data released by the Central Bank of Nigeria (CBN) shows.

The local currency also appreciated on the parallel market yesterday as it strengthened to N1,528/$1, its highest level in over a month, compared with Friday’s closing rate of N1,535/$1.

Forex traders attribute the naira’s strengthening in recent days to relatively low demand for dollars coupled with CBN’s FX interventions which are supported by healthy external reserves.

In a report released yesterday, Coronation Merchant Bank stated: “Last week, the naira appreciated by 1.10% (shedding N16.70) to close at N1,514.87/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEM). In the parallel market, the exchange rate remained steady at N1,540.00/$1. “Total FX inflows settled at $567.2 million, down from the $706.7 billion recorded in prior week.

Foreign Portfolio Investment (FPIs) led with the highest inflows contributing $184.1 million (32.5%) to the overall inflows. “Notably, the CBN intervened in the market accounting for $173.1 mn (30.5%).

Meanwhile, inflows from Exporters and Nonbank Corporates contributed 16.6 per cent and 16.2 per cent, respectively, while others accounted for 4.3 per cent. Gross external reserves inched up by $37.85 milliin w/w (0.09% w/w), reaching $41.31 billion.”