Naira Remains Intact, Despite 134 % Influx Of Foreign Liquidity
The naira/US dollar exchange rate closed at N415.07/$1 at the Investors and Exporters window, where forex is officially traded. The naira held steady over the US dollar on Friday, going to close at N415.07/$1. This was the same rate as on Thursday, October 21st, 2021.
Furthermore, the naira strengthened against the US dollar on Friday, closing at N574/$1, a 0.17 percent increase from the N575/$1 recorded at the end of trading on Thursday, October 21st, 2021. According to data gathered from BDC operators in Nigeria, the naira/US dollar exchange rate
In the official market, the local currency remained unchanged while the dollar supply increased by 134%. Meanwhile, the International Monetary Fund (IMF) has blamed the decline in diaspora remittances into Nigeria on the country’s foreign exchange market uncertainty. Nigeria’s foreign reserves closed at $40.76 billion on Wednesday, October 20th, 2021, representing a $377.04 million increase in the reserve position. On Wednesday, the country’s foreign reserve increased by 0.93 percent from the previous day’s total of $40.39 billion.
Trading at the NAFEX official window
On Friday, October 22nd, 2021, the exchange rate against the US dollar remained constant, closing the day at N415.07 to a dollar, indicating the same rate as on Thursday, October 21st, 2021.
On Friday, the opening indicative rate closed at N414.10/$1, down 16 kobos from the previous trading day’s closing rate of N413.94/$1.
Over intra-day trading, the highest rate of N429 to a dollar was reported before it settled at N415.07/$1, while it traded for as low as N404/$1 during the same period.
Meanwhile, on Friday, October 22nd, 2021, forex turnover at the official window increased by 133.6 percent.
Forex turnover at the I & E window jumped from $103.16 million on Thursday to $240.97 million on Friday, October 22nd, 2021, according to statistics tracked by Nairametrics from FMDQ.
Cryptocurrency verification
Bitcoin, the world’s biggest and most popular crypto, ended trading on a brighter note on Sunday evening, soaring 0.80 percent to $61,582 despite price volatility.
The total crypto market capitalization hit a low of $2.386 trillion on Monday before rising to a high of $2.741 trillion on Thursday. On Sunday, the total market value was $2.578 trillion.
Bitcoin’s dominance reached 47.72 percent on Wednesday, before falling to a 44.75 point margin on Saturday. At the time of writing, cryptocurrency accounted for 44.80 percent of sales.
Meanwhile, as China continues its cryptocurrency crackdown, other countries are taking notice.
On Sunday evening, Ethereum, the second-largest cryptocurrency by market capitalization, was also up 0.14 percent, trading at $4,136.31.On Sunday, XRP increased by 0.43 percent to $1.10.
The cost of crude oil
On Sunday, the crude oil market was upbeat, with most headline crudes rising 0.14 percent later in the evening to $85.65 per barrel after rising earlier in the day.
The American headline crude, the WTI, rose for the ninth week in a row, extending its winning streak as market attention shifted to the United States’ crude storage hub, which is at a three-year low.
Saudi Arabia had previously warned that oil producers should not take the recent rise in crude oil prices for granted because the coronavirus pandemic could still have an impact on demand.
Meanwhile, Nigeria has backed Saudi Arabia’s efforts to persuade OPEC to resist pressure from other stakeholders and some countries to increase production output.
WTI crude rose 0.42 basis points to $84.11 per barrel, while natural gas rose 5.44 percent to $5.567 per barrel. Similarly, the OPEC Basket increased by 0.07 percent to $83.36 per barrel.
Moreover, Nigeria’s light crude rose 1.60 percent to $84.37 per barrel.
The Nigerian External Reserve
Nigeria’s foreign reserves rose by $195 million on Thursday, October 21, 2021, to near $40.958 billion, up from $40.763 million on a preceding day. The recent increase reflects the growth of 0.48 percent in the country’s foreign reserve position.
So far in October, the nation’s foreign reserve has increased by $4.18 billion, owing to the $4 billion raised by the federal government through the issuance of Eurobonds in the international debt market. The gains recorded thus far in the month are greater than the $2.76 billion gain recorded in September 2021, while the recent increase brings the year-to-date gain to approximately $5.59 billion.
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