Connect with us
Advertise With Us

BUSINESS

Trading Turnover In I&E Window Hits N7.8trn In 9 Months

Published

on


Since its commencement in April, 2017, total turnover trade on Investors & Exporters (I&E FX) foreign exchange window has increased to N7.8 trillion or $25.65 billion in nine months of 2017.

LEADERSHIP findings show that September, followed by November had the highest turnover trade while, April, when the new special window of the Central Bank of Nigeria (CBN) was launched had the lowest turnover trade.

Data obtained from FMDQ OTC Securities Exchange revealed that $0.61 billion or N1865.66 billion total turnover was traded in April and increased by 114 per cent to $1.32 billion or N403.92 billion in May. Total turnover on the I&E FX window in June and July were $1.63 billion or N498.78 billion and $1.86 billion or N569.16 billion respectively.

Data showed that total turnover gained momentum in August 2017, as newly created window reached $3 billion per month. According to the data, I&E FX window in August was estimated at $3.54billion or N1.08 trillion, while in September, total trade on the I & E FX window closed at $4.61 billion or N1.41trillion.

For October, it dropped to $4.30 billion or N1.32 trillion. In addition, the total turnover trade on the window in November and December were $4.51 billion or N1.38 trillion and $3.27 billion or N1 trillion respectively.

The I&E FX was created by the CBN to boost supply of foreign exchange into the nation’s economy, attract more investments and stabilize the foreign exchange market. CBN introduced the special window for investors, exporters and end-users of foreign exchange on April 21, 2017 as part of its efforts to deepen the FX market and accommodate all the foreign exchange obligations.

Finance analysts said the absence of CBN’s weekly intervention also thrust trading on the specialized window though the foreign exchange market remains relatively stable.

Associate Professor and Head, Banking & Finance department, Nasarawa State University, Prof Uche Uwaleke, said, “There is no question that the Investors and Exporters window introduced by the CBN sometime in April 2017 was one of the best developments in the forex market last year.

“It came at a time the market was facing liquidity crisis and foreign investors’ confidence was waning. The window helped in no small measure in boosting liquidity and access to forex by creating an autonomous channel where the exchange rate is market determined.

“So, the huge turnover recorded since the introduction of the AFEX points to the strong confidence that investors now have in the Nigerian economy.  This measure, supported by the CBN’s sustained intervention, has aided the near convergence of rates across all market segments.

“The first positive sign manifested almost immediately with the parallel market rate dropping from a peak of N520 to a dollar to less than N400 few days after. Capital importation has been on the rise on the back of this forex window and the manufacturing sector has equally benefited going by the Purchasing Managers Index (PMI) which has been above the 50 points threshold since May last year.

Expressing his view, the President, Association of Bureau De Change Operators of Nigeria (ABCON) Alhaji Aminu Gwadabe, said transaction turnover recorded at the window in 2017 was an impressive reflection of the increasing level foreign investors/exporters confidence from a zero level of confidence.

According to him, the window enhances the realization of investors request for transparency and best global practice in the forex market. “The turnover of over N4.4 trillion in the stock market last year is an indication of the performance of the investors’ window.

Research analyst, Pan-African Capital Plc, Mr. Moses Ojo, during the weekend explained to LEADERSHIP that, I & E Fx window that was introduced by CBN has stabilize the foreign exchange market.  According to him, the fear of accessing foreign exchange was addressed, stressing that the I & E Fx window has impacted the manufacturing sector.



Copyright LEADERSHIP.
All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from LEADERSHIP Nigeria Newspapers. Contact: editor@leadership.ng







Advertisement
Comments

MOST POPULAR

Pin It on Pinterest

Share This

Share this post with your friends!