By Kayode Tokede
Naira at the Investors & Exporters Foreign Exchange ( I & E FX) window on Tuesday appreciated by 0.2 per cent to close at N411.08 against the dollar.
The local currency also appreciated by 0.1 per cent at parallel market to close N526 against the dollar.
The exchange rate between the naira and the dollar on Monday closed at N411.63/$1 at the I & E FX window, where foreign exchange is traded officially.
Naira had appreciated against the dollar to close at N411.63 against the dollar on Monday, representing a 37kobo gain when compared to N412 against the dollar recorded at the close of trading on Friday.
However, the naira further depreciated at the parallel market as it closed at N527/$1 on Monday, representing a N3 drop when compared to N524/$1 recorded on the previous trading day.
The naira slumped to a new record low against the dollar at the black market on Monday days after the CBN banned microfinance banks from foreign exchange transactions as dollar supply drops significantly by 62per cent.
Meanwhile, the overnight lending rate contracted by 67basis points to 6.5 per cent in the absence of any significant funding pressures on the system. Trading in the NTB secondary market ended on a bullish note, as the average yield contracted by 15bps to 4.6per cent.
Across the benchmark curve, the average yield contracted at the short (-44 basis points) end due to demand for the 72DTM (-106bps) bill but was flat at the mid and long segments.
Elsewhere, the average yield at the OMO segment expanded by four basis points to 6.1per cent.
The Treasury bond secondary market turned bearish, as the average yield expanded by 5bps to 11.1per cent.
Across the benchmark curve, the average yield expanded at the short (+13 basis points), and long (+2 basis points) ends due to sell-offs of the APR-2023 (+33bps) and MAR-2050 (+7basis points ) bonds, respectively; the average yield was flat at the mid-segment.
However, the Central Bank of Nigeria (CBN) has said foreign reserve rose by $91 million as it recorded its third increase in over 2 weeks to close at $33.662 billion on Friday, compared to $33.571 billion recorded as of the previous day. The latest increase represents a 0.27per cent boost in the country’s foreign reserve.
In the same vein, the reserve level has also gained $259 million month-to-date compared to $33.403 billion recorded as of the beginning of the month.
However, its year-to-date change shows a $1.891 billion loss compared to $35.37 billion recorded as of 31st December 2021.
While recent reports have suggested that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021, the recent decline in the external reserve could be attributed to the decline recorded in the global crude oil market in recent weeks.