In the just concluded week, Naira depreciated further against the USD at the Bureau De Change and the parallel (“black”) market by 0.66% and 0.43% to close at N460.00/USD and N467.00/USD respectively. This further widened the gap between these market segments and autonomous market, contrary to the objective of CBN to harmonise all FX rates, as NGN/USD exchange rate at the Investors and Exporters FX Window (I&E FXW) closed flat at N386.00/ USD.
Also, NGN/USD closed flat at N381/USD at the Interbank Foreign Exchange market amid weekly injections of USD210 million by CBN into the forex market: USD100 million was allocated to Wholesale Secondary Market Intervention Sales (SMIS), USD55 million was allocated to Small and Medium Scale Enterprises and USD55 million was sold for invisible.
Elsewhere, the Naira/USD exchange rate appreciated for most of the foreign exchange forward contracts to settle below N400/USD: 1 month, 2 months, 3 months, 6 months and 12 months rates fell by 0.08%, 0.17%, 0.25%, 0.40% and 0.58% respectively to close at N386.47/USD, N386.96/USD, N387.48/USD, N389.82/USD and N399.44/USD respectively; while spot rate closed flat at N381.00/USD.
In the new week, we expect Naira/USD to remain stable at the I&E FX window and the interbank forex market segment as most foreign exchange forward contracts have settled below N400/USD they were trading at a couple of weeks ago amid relative stability in the global crude oil market. However, we may see increased pressure at the black market amid unsatisfied demand in that segment.