The inflow of foreign exchange dropped further last week as the volume of dollars sold by the Central Bank of Nigeria (CBN) and Nigeria Autonomous Foreign Exchange Market (NAFEX) declined to $1.066 billion against $1.073 billion that changed hands in the previous week.
Volume of the dollars that came in through the Investors’ and Exporters’ (I&E) fell from $863.07 to $856.07 as activities at the I&E failed to compliment the CBN’s intervention of $210 million as trading did not pick up due to the depreciation of the naira at the beginning of trading on Monday as it closed at N362 although it firmed to N361.16 at the end of the week’s trading.
The interbank market segment of the CBN witnessed a gradual depreciation of the naira. It traded at N305.75 at the start of trading on Monday and depreciated by five kobo at the close of trading on Friday.
At the bureau de change (BDC) end of the parallel market, the value of the naira fluctuated throughout the week trading within the N359 and N358 band. The naira maintained its strength against the pounds sterling as it sold at the range of N480 and N485 while euro traded at N417 and N418.5.
Nonetheless, CBN’s intervention of $210 into the interbank foreign exchange market on Tuesday was as usual aimed towards boosting liquidity and alleviate dollar shortages.
According to the bank, it had released $100 million earmarked for the wholesale market, $55 million for small businesses and individuals, and $55 million for certain dollar expenses such as school fees and medical bills.
The interbank market opened awash with liquidity at N619 billion boosted by OMO maturities of N406.83 billion, spurring the CBN to take via an OMO auction. On offer were the 70- and 210-Day bills, were a total of N315.33 billion was sold at 11.05 percent and 12.15 percent stop rates respectively.
However, the Open Buy Back (OBB) and the Overnight (O/N) rates dropped to open at four percent and five percent respectively, but moved upwards following the OMO auction to trade at nine percent (OBB) and 10.00 percent (O/N) in late trades as market remained relatively liquid.
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