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Exchange rate gains at official I&E window as dollar supply hits $214 million

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Wednesday, 14th July 2021: The exchange rate between naira and the US dollar closed at N411.22/$1 at the Investors and Exporters (I&E) window.

Naira appreciated against the US dollar on Wednesday, 14th July to close at N411.22 to a dollar as against N411.75 recorded in the previous trading session on Tuesday, 13th July 2021.

At the parallel market, the naira remained stable at N505/$1, the same as recorded since Friday, 9th July 2021. On the other hand, Nigeria’s external reserve dipped $11.79 million on Monday, 12th July 2021 to close at $33.087 billion but gained $8.39 million on Tuesday, to close at $33.096 billion.

Trading at the official NAFEX window

Naira appreciated against the US dollar at the Investors and Exporters window on Wednesday to close at N411.22/$1 from N411.75/$1 recorded on Tuesday, 13th July 2021.

The opening indicative rate stood at N411.21/$1 on Wednesday, representing a 31 kobo appreciation compared to N411.52/$1 recorded on Tuesday.

An exchange rate of N412.3/$1 was the highest rate recorded during intra-day trading before it settled at N411.22/$1, while it sold for as low as N387.67/$1 during intra-day trading.

Meanwhile, forex turnover at the Investors and Exporters (I&E) window also increased by 84.2% on Wednesday, 14th July 2021.

According to data tracked by Nairametrics from FMDQ, forex turnover increased from $116.15 million recorded on Tuesday, 13th July 2021 to $213.99 million on Wednesday, 13th July 2021.

Cryptocurrency watch

The crypto market gained marginally by 0.68% on Wednesday to close at $1.33 trillion, indicating a gain of $8.93 billion for crypto investors.

The world most popular digital asset also gained marginally, recording a growth of 0.5% to close at $32,909.02 on Wednesday, as of 10:18 pm.

Ethereum also grew by 2.83% to close at 1,995.07, while XRP gained 0.25% to close at $0.62116.

Bitcoin has now gone into its eighth straight week of trading roughly sideways.

Analysts have suggested that Bitcoin trading was buoyed along with assets in traditional markets by Federal Reserve Chair Jerome Powell’s assurances that he’s still not seeing “substantial further progress” on economic recovery – signaling that the U.S. central bank isn’t likely to dial back monetary stimulus anytime soon.

Crude oil

The crude oil market traded bearish on Wednesday, despite Saudi Arabia and UAE resolving their nearly two-week disagreement over production levels, which had stalled a unanimous OPEC+ deal on oil supply.

Brent Crude oil dipped 2.5% to close at $74.58 compared to $76.49 per barrel recorded on Tuesday.

WTI Crude also declined by 3.11% to close at $72.91 per barrel, while Bonny Light recorded a 0.6% decline to close at $74.16.

Reports have indicated that Riyadh has agreed to Abu Dhabi’s request to have its baseline production level lifted to 3.65 million barrels per day (bpd) from 3.17mbpd when the current pact expires in April 2022.

External reserve

Nigeria’s external reserve recorded a rare gain of $8.39 million on Tuesday, 13th July 2021 to close at $33.09 billion, representing a 0.03% increase compared to the $33.09 billion recorded as of Monday.

Nigeria’s foreign reserve has endured a significant decline year-to-date, losing about $2.28 billion between January and July, and $227.2 million in July alone.

These declines continued despite the increase in the price of crude oil in the global market, however, Nigeria has been unable to record commensurate export earnings due to the OPEC+ cut in production quota.

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