Exchange rate gains marginally at official market as Bitcoin price dips significantly

Exchange rate gains marginally at official market as Bitcoin price dips significantly

Tuesday, 21st September 2021: The exchange rate between the naira and the US dollar closed at N413.28/$1, at the official Investors and Exporters window.

Naira gained against the US dollar on Tuesday, to close at N413.28/$1, representing a 0.1% appreciation compared to N413.68/$1 recorded on Monday, 20th September 2021.

The global crypto market nosedived on Tuesday as investors in the digital assets lost over $96 billion to bearish sentiments in the market, triggered by a downturn recorded in the price of Bitcoin, which slumped by 5.14%.

Nigeria’s foreign reserve gained $280.44 million on Monday, 20th September 2021 to close at $35.74 billion, according to data from the Central Bank of Nigeria. So far in the month of September, the CBN has recorded a total reserve gain of $1.72 billion.

Trading at the official NAFEX window

The exchange rate depreciated against the US dollar on Tuesday 21st September 2021 to close the day at N413.28 to a dollar, representing a 0.1% marginal gain compared to N413.68/$1 recorded in the previous trading day.

The opening indicative rate closed at N413.21/$1 on Tuesday, representing a 40 kobo decline when compared to N412.81/$1 recorded on Monday, 20th September 2021. An exchange rate of N414.5 to a dollar was the highest rate recorded during intra-day trading before it settled at N413.28/$1, while it sold for as low as N404/$1 during intra-day trading.

Meanwhile, forex turnover at the Investors and Exporters (I&E) window surged by 119.9% on Tuesday, 21st September 2021.

FMDQ, forex turnover increased from $91.23 million recorded on Monday to $200.65 million on Tuesday 21st September 2021.

Cryptocurrency watch

The crypto market endured a bearish trading session on Tuesday as the market capitalisation shed 5.05% to close at $1.82 trillion, indicating that investors parted with $96.67 billion during the day’s trading.

The loss recorded by the industry was due to the significant decline recorded in the price of the world’s most valuable cryptocurrency, Bitcoin, which slipped by 5.14% to close at $40,823.77 on Tuesday.

Similarly, Ethereum, the highly sort-after crypto-asset also recorded a 7.35% decline to close at $2,758.62 while XRP dipped 4.04% to close at $0.88238.

The bearish sentiments in the market have been attributed by analysts to the fears regarding the potential default of Evergrande Group, a China-based real estate company whose collapse would affect the equities market.

A recently published article highlighted that 182,798 Bitcoin traders had been liquidated on Tuesday.

However, a quick check shows that the crypto market has stabilised in the early hours of Wednesday as Bitcoin has settled above $42,000 as of the time of writing this article.

Crude oil price

The crude oil market enjoyed a fair bullish trading session on Tuesday from a significant dip at the start of the new week. Brent Crude closed the trading session at $74.69 per barrel, having gained 1.04%, as opposed to the downturn recorded on Monday.

West Texas Intermediate also recorded a positive growth in price to close at $70.56 per barrel, with a gain of 0.38%. Natural Gas dipped by 3.61% to close at $4.805.

Bonny Light, Nigeria’s crude dipped by 0.65% to close trading on Tuesday at $73.02 per barrel while OPEC Basket closed at $73.47 having lost 0.9%.

Meanwhile, the market seems to be consolidating on the positives of the previous trading session as Brent has hit the $75 per barrel mark again with a gain of $1.2% in the early hours of Wednesday as of 6:45 am.

External reserve

Nigeria’s foreign reserve gained $280.44 million on Monday, 20th September 2021 to close at $35.74 billion compared to $35.46 billion recorded as of the previous day. The latest increase represents a 0.79% boost in the country’s foreign reserve and the highest gain recorded since the beginning of the growth in August 2021.

The reserve has now gained $1.72 billion in the month of September 2021, while the recent gain has cancelled out the year-to-date loss as it currently stands at a gain of $361.74 million.

The recent increase in the reserve position, which has continued for 19 consecutive days is in line with recent reports which had suggested that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021.

While the foreign reserve continues to grow, the recent Eurobond being opened by the federal government could further boost the reserve level.

The official NAFEX rates are obtained from the website of the FMDQOTC. Parallel market rates are obtained from various sources including online media outlets. The rates you buy or sell forex may be different from what is captured in this article.

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