Interbank Naira/Dollar Forex Rate Depreciates to N314.87/USD

In the just concluded week, the Nigerian Naira depreciated against the greenback at the interbank foreign exchange market by 0.08% to close at N314.87/USD. This was inspite of sales of USD100 million through foreign exchange two months delivery forwards by CBN on Thursday to banks. International Money Transfer Operators (IMTOs) also supplied USD10,000 each to 3,135 licensed Bureau De Change (BDC) operators in the country, totaling USD31.35 million. The local currency also depreciated at the Bureau De Change and parallel (‘black’) market segments by 1.84% and 1.79% to N387/USD and N397/USD respectively. Meanwhile, the weekly movements in most dated forward contracts at the interbank OTC segment suggested future stability of the Naira viz-a-viz the US greenback amid a slight increase in the foreign exchange reserves – external reserves increased week-on-week by 0.10% to USD30.326 billion as at Wednesday, 05 April 2017. The 1 month, 3 months, 6 months and 12 months forward contracts remained stable w-o-w at N315.34/USD, N323.27/USD, N331.53/USD and N349/USD respectively. The spot rate however appreciated by 0.05% to N306.20/USD amid the USD7.5 million in intervention sales by CBN to banks. In the current week, we expect further depreciation albeit at a slower rate subject to CBN’s level of intervention.