The naira remains stable in the foreign exchange markets as the external reserve plunges to its lowest level in 14 months

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Friday June 25, 2021: The exchange rate between the naira and the US dollar closed at 411.67 N / $ 1 at the investors and exporters window, where the forex is officially traded.

The naira was stable against the US dollar on Friday to close at N411.67 per dollar, the same as recorded the day before. However, it represents a depreciation of 0.16% for the week compared to the N411 / 1 $ recorded on Friday, June 18, 2021.

In addition, the exchange rate remained stable in the parallel market to close at N500 / $ 1 on Friday, June 25, 2021, the same as recorded on Thursday. Nigeria’s external reserve, however, plunged $ 45.33 million on Thursday, June 24, 2021, bringing its monthly loss to $ 681.9 million.

Trading at the official NAFEX window

The naira was stable against the US dollar at the Investors and Exporters window on Friday to close at 411.67 N / $ 1.

  • The indicative opening rate depreciated by 13 kobo to close at N411.55 per dollar on Friday June 25, 2021, compared to N411.42 / $ 1 recorded on Thursday June 24, 2021.
  • An exchange rate of N 412.56 per dollar was the highest rate recorded in intraday trading before settling at N 411.67 / $ 1, while it also sold for too as low as $ 400/1 when trading intra-day.
  • The Forex turnover of the Investors and Exporters (I&E) window increased slightly by 4.6% on Friday, June 25, 2021.
  • Data tracked by the FMDQ’s Nairametrics revealed that forex revenue fell from $ 109.47 million on Thursday, June 24, 2021 to $ 114.53 million on Friday.

Cryptocurrency watch

The cryptocurrency market saw a partial gain on Sunday, as the total market cap edged up 0.24% to close at $ 1.28 trillion.

  • The most popular digital asset also gained 1.03% to close at $ 32,602.14, while Ethereum was down 0.35% to close at $ 1,824.71.
  • Last week, South African brothers Raees and Ameer Cajee, who ran Africrypt, a cryptocurrency investment firm, disappeared with more than $ 3.6 billion in Bitcoin.
  • China has also banned crypto mining in important parts of the country, while the People’s Bank of China has called for swift verification and deactivation of customer accounts that conduct cryptocurrency transactions.
  • Meanwhile, the New Oxford Science Academy, a private high school in Kano State, has announced that it will accept cryptocurrency as a means of paying tuition fees. This despite the fact that the CBN prohibits financial institutions from providing cryptocurrency-related services.

Crude Oil Price

Crude oil prices continued their uptrend as Brent crude, WTI, Bonny Light, Opec Basket, among others, all posted positive price growth.

  • Brent crude closed at $ 76.18 per barrel while WTI crude closed at $ 74.05 per barrel, a gain of 0.75%.
  • The higher prices can be largely attributed to declining U.S. oil inventories, increased demand for oil, and a statement by the U.S. government contradicting Iran’s previous statement that the U.S. agreed to lift. all sanctions related to Iranian crude oil.
  • The uptrend in the crude oil market can also be attributed to the rapid deployment of effective vaccines in Europe, America, as well as strict quarantine controls in China and other parts of Asia.
  • Oil prices continued to recover despite the possibility that OPEC could relax its production quotas.

External reserve

Nigeria’s external reserve plunged again on Thursday, June 24, 2021, from $ 45.33 million to close at $ 33.55 billion. This represents a decrease of 0.13% from the 33.59 billion dollars recorded the day before.

  • Nigeria’s foreign exchange reserve fell to its lowest position in more than 14 months, its year-to-date decline to $ 1.83 billion, while its month-to-month decline was 681, $ 9 million.
  • The decline can be attributed to the reduction in foreign exchange earnings, especially crude oil exports due to the reduction in production quotas. This despite the recent uptrend in the global crude oil market. Oil is currently trading at over $ 76 a barrel.
  • The government will be looking to find a way to improve forex liquidity, as the CBN’s “4 Dollar Naira” has yet to reflect on the country’s forex reserve level.

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