Naira trades flat at CBN’s interbank market window

By Kayode Tokede

Naira at the Central Bank of Nigeria (CBN) interbank market window traded flat N379 against the dollar. Our correspondent gathered that the naira closed at N379 against in 2020.

However at the Investors & Exporters Foreign Exchange (I &EFX) window, the Naira closed up by 0.12per cent, 1.35 per cent and 1.30 per cent against the dollar, euro and pound to print at N393.83, N481.98 and N534.19 respectively.

According to FMDQ Exchange, a total of $ 33.51 million was traded by investors and exporters on Tuesday.

The local currency at the parallel market also remained flat against the dollar, euro and pound to close at N470, N572 and N628 respectively.

The exchange rate at the parallel market closed at N470 against the dollar on the last day of trading December 31, 2020.  It has been trading at N470 against the dollar since the December 29, 2020.

The exchange rate disparity between the parallel market and the official market widened again to N75.7 representing a 16per cent devaluation differential.

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

Meanwhile, the money market rates fell today as Open Buy Back and Overnight rate decreased by 37basis points and 50 basis points to close at 0.63per cent and one per cent respectively.

The bond market traded on a quiet note today as yields remained flat across most tenures. We witnessed the yield on the 7yr benchmark bond decrease by eight basis points  to print at 6.34 per cent, while the 5yr benchmark bond inched up by 2bps to close at 5.44per cent. Conversely, the yield on the 10yr benchmark bond closed flat at 7.27per cent.

“In the near term, we expect market activity to be influenced by liquidity levels and foreign investor participation,” analysts at investment one research added.