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Naira gains marginally at official market as foreign reserve gains $1.81 billion

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Naira gains marginally at official market as foreign reserve gains $1.81 billion

Wednesday, 22nd September 2021: The exchange rate between the naira and the US dollar closed at N413.18/$1, at the official Investors and Exporters window.

Naira gained marginally against the US dollar on Wednesday, to close at N413.18/$1, representing a 0.02% appreciation compared to N413.28/$1 recorded on Tuesday 21st September 2021. The exchange rate has now maintained an average of N413.38/$1 between Monday and Wednesday.

Similarly, the exchange rate at the parallel market also appreciated to N572/$1 on Wednesday from N575/$1 recorded a day before. This is according to information obtained from licenced BDC operators in Lagos.

Nigeria’s foreign reserve also gained $89.44 million on Tuesday, 21st September 2021 to close at $35.83 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 $1.81 billion.

Trading at the official NAFEX window

The exchange rate recorded a marginal gain against the US dollar on Wednesday 22nd September 2021 to close the day at N413.18 to a dollar, representing a 0.02% appreciation compared to N413.28/$1 recorded in the previous trading day.

The opening indicative rate closed at N412.89/$1 on Wednesday, representing a 32 kobo appreciation when compared to N413.21/$1 recorded on Tuesday, 21st September 2021.

An exchange rate of N415.2 to a dollar was the highest rate recorded during intra-day trading before it settled at N413.18/$1, while it sold for as low as N404/$1 during intra-day trading, the same as the previous day.

Meanwhile, forex turnover at the official window increased by 14.5% on Wednesday, 22nd September 2021.

FMDQ, forex turnover increased from $200.65 million recorded on Tuesday to $229.72 million on Wednesday 22nd September 2021.

Cryptocurrency watch

The crypto market recovered from the downturn it recorded in the previous day as it gained 9.14% to close at $1.974 trillion. This indicates that crypto investors gained a sum of $165.27 billion on Wednesday, which represents a recovery from the $96.67 billion lost in the previous day. The market was pushed by the positive rally recorded by Bitcoin, which gained 7.25% to close at $43,538.5, while Ethereum recorded a gain of 9.81% to close at $3,037.16.

The crypto market endured a bearish trading session on Tuesday as Bitcoin and Ethereum dipped by 5.14% to close at $40,823.77 and 7.35% to close at $2,758.62 respectively. The bearish sentiments in the market were 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 had stabilised in the early hours of Wednesday as Bitcoin had settled above $42,000 as of the time of writing this article.

Crude oil price

The crude oil market enjoyed a positive rally on Wednesday, 22nd September 2021 as Brent Crude gained 2.12% to close at $75.94 per barrel, despite recording a downturn at the start of the week. In the same vein, West Texas Intermediate gained 2.11% to close at $71.97 per barrel.

The OPEC Basket also gained 0.29% to close at $73.68 per barrel, Natural Gas dipped by 0.89% to close at $4.762. Bonny Light, Nigeria’s crude dipped by 0.64% to close at $72.55 per barrel. Other Nigerian crude includes Brass River (+0.71%) to close at $74.12 and Qua Iboe (+0.97%) to close at $74.12.

Meanwhile, a recent report by Bloomberg has hinted that Brent crude oil could reach $90 per barrel if the weather in the northern hemisphere becomes colder than normal during winter. This was stated by Goldman Sachs’ Jeff Currie while talking to Bloomberg.

External reserve

Nigeria’s foreign reserve gained $89.44 million on Tuesday, 21st September 2021 to close at $35.83 billion compared to $35.74 billion recorded as of the previous day. The latest increase represents a 0.25% boost in the country’s foreign reserve and the highest level since February of the year.

The reserve has now gained $1.81 billion in the month of September 2021, while the recent gain puts the year-to-date gain at $451.18 million The recent increase in the reserve position, which has continued for 20 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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