Naira ends trading week stable amid $355.43m forex injection

The Nigerian currency, Naira, at the close of trading week remained stable amidst injections of $355.43 million to the Retail Secondary Market Intervention Sales (SMIS) of the foreign exchange market by the Central Bank of Nigeria (CBN.

As part of its efforts to boost liquidity and alleviate dollar shortages, the apex bank had on Friday injected $355.43 million into the interbank foreign exchange market.

The Naira, at the official spot market ended the week on a positive note to close at N305.80 better than N305.85 began trading last Monday.

In the other hand, the local currency was seen at N362 per dollar the same rate it traded throughout the week at the parallel market, as well stood steadied against the two other major foreign currencies, Pound sterling and Euro at 500 and 442, respectively.

Also, at the Investors and Exporters (FX) window, the Naira, on the last trading day of the week opened low at N359.97 to the dollar against N359.94 traded a day earlier, however, traded high at N361.50 before closing at N360.32 weaker than N360.26 sold the previous day.

Although, the special forex window recorded an appreciable transactions turnover of $201.21 million better than $120.43m declared on Thursday.

Figures obtained from the CBN by pour correspondent revealed that the provision was to help meet requests in the agricultural, airlines, petroleum products and raw materials and machinery sectors of the economy.

The CBN’s Acting Director, Corporate Communications Department, Isaac Okorafor reiterated the bank’s commitment to continually intervene in the market aimed at sustaining liquidity in the market as well as boosting production and trade.

Mr. Okorafor said with accretion to the country’s foreign reserve, the bank was in a much better position to ensure liquidity in the inter-bank sector of the FOREX market.

The bank will continue to intervene in order to drive growth in the economy and guarantee stability in the market, particularly now that the economy has gained steam due to an upsurge in the non-oil sector, he said.

With the rates closing at N360 to the dollar on Friday, Okorafor expressed confidence the Bank’s forex intervention underscored its determination to maintain the country’s external reserves, in order to safeguard the international value of the Naira.

The CBN, in February 2018 in its last SMIS, injected about $321.4 m in the interbank market, while also intervening in the inter-bank foreign exchange market with about $210 million.

This comprised $100m for the wholesale segment and $55m each for both the Small and Medium Enterprises (SMEs) and invisibles segment.

The apex bank between April and end of February, 2018, had spent $18.37 billion in its weekly intervention in the foreign exchange (forex) market, The Daily Times Investigations revealed.

The breakdown showed that the CBN, between April and December 21017 intervened with total sum of $15.9 billion, which was higher than $9.6bn spent during same period of 2016.

The move by CBN is to reduce speculative trading at the parallel market and support key sector of the nation’s economy.

However, further checks by our correspondent showed that the Bank in the first two month of 2018 hadinjected into the forex market the total sum of $2.68bn to support the Nigerian local currency, due tosteady accretion to the foreign reserves gaining 9.26 per cent year-till-date to $42.35bn as at February 27, 2018.

Meanwhile, forex traders are optimistic that the naira is likely to remain stable, due to continued interventions in the currency market by the Central Bank and forex flows from exporters.