CBN: Forex injection hits $798m in June

As part of effort to further close the gap between the official foreign exchange and the unofficial rates, the Central Bank of Nigeria (CBN), has injected not less than $798 million into the official segment of the market in the last three weeks of this month.

Findings showed that since introduction of Investors & Exporters Foreign Exchange window, an estimated trading increased to $2.97 billion has been sold between April 28th and June 16th, 2017.

The CBN had injected $195million to meet market demands last week; and expected to inject another into the market this week, a follow up to over $800million that was injected into the inter-bank foreign exchange market in prior week.

According to CBN, the $195 million breakdown of the intervention shows that the sum of $100million was offered to authorised dealers interbank wholesale window and $50 million (through the Small & Medium Enterprises window), and $45 million (for invisibles).

As the apex bank continued to intervention in the foreign exchange market, the Naira, in the interbank market – had appreciated by 3.28 per cent and 2.89 per cent against the Pound and Euro, to N401.06 and N352.90 respectively, while it weakened 0.03per cent against the Dollar to N305.85.

In the parallel market, the Naira traded flat against the Pound at N465 and depreciated by 0.7 per cent week on week (w/w) to f N410 while it strengthened by 0.27per cent (w/w) against the Dollar to N368.

The Naira weakened in the Investors/Exporters foreign exchange market last week losing 1.11 per cent (w/w) against the Dollar to close at N362.16.

According to Organization of Petroleum Exporting Countries (OPEC), basket of 14 crudes stood at $42.58 a barrel on last week Thursday

The recently signed 2017 Budget included, a crude oil price benchmark of $44.5, an increase from the $42.58 oil price benchmark submitted by the Presidency.

OPEC struck a deal to cut output effective next month, but excluded Nigeria and Libya from the cuts.

“A further drop in price could negatively impact on the country’s revenue projections for 2017,” finance experts said.

The Director, Banking Supervision Department, CBN, Ahmed Abdullahi, had said at the 333rd Bankers’ Committee Meeting that an estimated $6 billion has been injected into the foreign exchange market in six months, while the newly introduced Investors & Exporters Foreign Exchange window registered no less than $2.2 billion

He said that improvement in the foreign exchange has helped in stabilizing the market, stressing that with sustainable momentum, the Nigerian Gross Domestic Products (GDP) will be on positive growth by third quarter, 2017.