Naira appreciates to N394/$ at I & E FX

The naira against the dollar appreciated by 0.03 per cent to close at N394 against the dollar at the Investors & Exporters Foreign Exchange on Monday.

The naira closed up by 2.59per cent and 2.88 per cent against the euro and pound sterling at the I & E FX market close at N474.63 and N537.51 respectively.

According to FMDQ, total turnover trade on Monday was $28.85 million.

At the parallel market, the naira closed flat against the euro, pound sterling and dollar at N580, N652 and N480 respectively.

At the interbank market of the Central Bank of Nigeria (CBN), naira traded flat at N379 against the dollar on Monday.

Analysts at Investment One research said, “Going forward, we expect the FX market to be dictated by heightened dollar demand and CBN FX policies.”

The weakening of the local currency could be attributed to demand pressure and forex shortage as business activities pick up after a slow start at the beginning of the year.

Manufacturers in Nigeria in a report, have listed difficulty in having access to foreign exchange to pay for their imports as the biggest challenge they face.

The Central Bank of Nigeria is expected to devalue the naira by as much as 10per cent this year in the face of lingering dollar shortage in the country, according to a survey by Bloomberg.

However, the money market rates declined today as Open Buy Back and Overnight rates decreased by 50basis points and 75basis points to 10 per cent and 10.25per cent respectively.

They  added that, “The bond market was positive today as yields decreased across most tenures. We witnessed the yields on the 5yr and 10yr benchmark bonds decrease by 32 basis points and 10bps to close at 6.35per cent and 8.98 per cent respectively, while the yield on the 7yr benchmark bond closed flat at 8.50per cent.

“In the near term, we expect market activity to be influenced by liquidity levels and foreign investor participation.

“It called on interested investors to contact the stockbroking firms appointed as distribution agents by the DMO.”