Naira rebounds as Forex market lifted by $195m

The naira, which had dropped to 367 at the end of Monday trading rebounded on Tuesday, to close at 365 after the Central Bank of Nigeria (CBN) boosted the foreign exchange (Forex) market by offering a total sum of $195million in different segments of the market.

The local currency, however, depreciated slightly against the pound and Euro, closing at 476 and 430, respectively, compared to 476 and 428 traded on Monday at the parallel market.

The naira, on Tuesday, at the official foreign exchange market sustained a slim gain of 0.02 per cent at 305.50 per dollar exchanged on Monday, as against 305.55 sold on Friday.

At the Investor & Exporter FX widow, the naira, yesterday opened at a better rate of 366.70 against 367.04 it stood on Monday, showing a total gain of 0.09 per cent, but depreciated by 0.026 per cent to record a new rate of 367.38.

Although, the I&E FX widow, recorded an improvement in the daily turnover, with new figure of $96.03 million against $95.63 million declared the previous day but lower than $101m traded on Thursday, latest data obtained from the FMDQ OTC has revealed.

But in an effort to close gap between the unofficial segment and the official forex rate, the apex bank in the wholesale segment of the inter-bank Foreign Exchange market auctioned $100m and also intervened in the Small and Medium Enterprises (SMEs) and invisible segments, with the sum of $50m and $45m, respectively.

Responding to media inquiry, Acting Director, Corporate Communications Department, Mr. Isaac Okorafor, reaffirmed the bank’s commitment to sustain liquidity in the market to ensure that genuine requests for FOREX are met as well as improve liquidity and flexibility in the market.

The intervention in the new week follows the major intervention last week, which shows a total sum of $462,336,426.74m made up of $267,336,426.74m, for the Retail Secondary Market Intervention Sales (SMIS), while the sum of $100,000,000m was offered as wholesale interventions, $50,000,000m for the Small and Medium Enterprises (SMEs) forex window and $45,000,000 for the invisibles – Business/Personal Travel Allowances, tuition and medical fees, among others.

Mr. Okorafor stated that the leadership of the CBN was upbeat with the positive impact its current foreign exchange management is having on the manufacturing sector, agriculture and economic activities across the country.

He also reiterated the CBN Governor’s desire to achieve stability and ultimately ensure convergence of rates in the market.

Motolani Oseni