The Nigerian currency, the Naira, has risen in the official market as external reserves have increased for the first time in over a month
Ejes Gist News reports that the exchange rate between the Nigerian naira and the US dollar Opened today at ₦413.85/$1 in the official Investors and Exporters (I&E) window.
The naira gained 0.02 percent against the dollar on Friday, closing at N414.73/$1, up from N414.8/$1 in previous trading sessions, as Nigeria’s external reserve increased by $69 million for the first time in over a month.
The official market’s forex turnover fell by 37.4 percent to $139.67 million from $223.18 million the day before.
The naira, on the other hand, depreciated against the US dollar on Friday, falling 0.53 percent to close at N570/$1 versus N567/$1 in the previous trading session. According to data gathered from BDC operators interviewed by Ejes Gist News, this is the case.
Nigeria’s foreign reserve fell by 0.09 percent on Thursday, December 2nd, to $41.12 billion, down from $41.15 billion the day before. The apex bank’s intervention in the official forex market is blamed for the recent drop in the country’s external reserves.
Trading at the NAFEX official window
On Friday, the Investors and Exporters window exchange rate rose by 7 kobo to close at N414.73/$1, up from N415.8/$1 over the previous six trading sessions.
On Friday, the opening indicative rate fell 12 kobo to N414.06/$1, a decrease of 12 kobo from the previous trading session’s rate of N413.94/$1.
During intra-day trading, the highest rate was N461.27/$1 before it settled at N414.73/$1, and it sold for as low as N404/$1 before settling at N414.73/$1.
On Friday, forex turnover at the official window fell by 26.2 percent to $103.01 million.
Forex turnover at the I&E window fell from $139.67 million on Thursday 2nd December 2021 to $103.01 million on Friday 3rd December 2021, according to data tracked by Ejes Gist News from FMDQ.
Keep an eye on cryptocurrency.
The crypto market had a wild weekend, with Bitcoin and other cryptocurrencies plummeting, yet another sign of the risk aversion sweeping financial markets.
Bitcoin, the world’s most valuable cryptocurrency, fell 0.63 percent to $48,997.87 in the early hours of Monday, after plunging by 20 percent to $42,000 over the weekend.
The weekend cryptocurrency thrashing, which dragged Bitcoin below $50,000 and wreaked havoc on other digital coins, has tempered investor optimism, which had been predicting a run at $100,000 just weeks ago.
The dramatic crash was fueled by liquidations in the crypto derivatives market, market players say, and was fueled by uncertainty over the Federal Reserve easing monetary policy in the face of surging inflation and global fears over the new Omicron variant of COVID-19.
Ethereum, the second most valuable cryptocurrency by market capitalization, fell 0.98 percent to $4,160.10.
The price of crude oil
Oil prices rose in the early hours of Monday, with Brent crude rising 2.03% to $71.30 per barrel after Saudi Arabia raised its crude prices, signaling confidence in the demand outlook despite the spread of the Omicron coronavirus variant.
The rise in oil prices is also aided by the dimming prospect of an increase in Iranian exports as indirect US-Iran talks on reviving the nuclear deal appear to have reached a stalemate.
Saudi Arabia increased official selling prices for all crude grades sold to Asia and the United States by up to 80 cents in January, compared to the previous month.
The price hikes were implemented despite the Organization of Petroleum Exporting Countries and their Allies, including Russia, deciding last week to keep increasing supplies by 400,000 barrels per day in January, a group known as OPEC+.
Concerns that the new coronavirus variant Omicron could have an impact on global economic growth and fuel demand caused oil benchmarks to fall for the sixth week in a row for the first time since November 2018 last week.
The West Texas Intermediate crude oil price rose 2.14 percent to $67.68 per barrel. Natural gas, on the other hand, fell 7.14 percent to $3,837 per barrel, while the OPEC Basket fell 2.23 percent to $70.03 per barrel.
Nigerian crude Bonny Light, on the other hand, was up 2.26 percent to $70.68 per barrel.
Reserves from outside sources
Nigeria’s external reserve fell by 0.09 percent to $41.12 billion on Thursday, December 2nd, 2021. This represents a decrease of $36+.5 million from the previous day’s total of $41.15 billion.
The apex bank’s continuous intervention in ensuring the exchange rate’s stability can be attributed to the country’s reserve level’s consistent decline.
It’s worth noting that the country’s foreign reserve increased by $5.99 billion in October as a result of the federal government raising $4 billion through the issuance of Eurobonds on the international debt market.
Nigeria’s external reserve fell by $633.47 million in November, compared to a gain of $5.99 million the previous month and a gain of $2.76 million in September 2021. The reserve gain for the year to date has dropped to $5.74 billion.