Total FX market turnover rose by 0.73% in April — FMDQ


By Kayode Tokede

FMDQ Exchange has disclosed that total Foreign Exchange (FX) market turnover in April 2021 was $12.44billion or N5.11trillion, representing a Month-on-Month (MoM) increase of 0.73per cent or $0.09billion from $12.35billion  turnover recorded in March 2021.

The Fixed Income and Currencies (FIC) report by FMDQ stated that FX Spot turnover increased MoM by 24.62 per cent or $0.97billion to $4.91billion in April 2021,offsetting the 10.46per cent  or $0.88billion decrease in FX Derivatives turnover, and accounting for the total increase in FX market turnover in April 2021.

The report stated that the MoM decrease in FX Derivatives turnover was jointly driven by the MoM decrease of 30.33per cent ($1.55billion) and 34.56 per cent ($0.47billion) in FX Swaps and Other Derivatives turnover respectively, offsetting the 61.29per cent ($0.57billion) and 56.44 per cent ($0.57billion) MoM increase in FX Futures and FX Forwards turnover respectively.

FMDQ stated that turnover in the FIC markets for the month ended April 30, 2021 was N16.18trillion, representing a MoM and Year-on-Year (YoY) decrease of 17.24 per cent or N3.37trillion) and 3.11per cent or N0.52trillion respectively

“FX and Money Market transactions were the highest contributors to the FIC markets in April 2021, jointly accounting for 54.57per cent of the total FIC markets turnover,” the report said.

The average Central Bank of Nigeria (CBN) Official Spot $/N exchange rate remained constant at $/v379.00 in April 2021.

The FMDQ FIC’s report stated that, “Conversely, the Naira depreciated against the Dollar at the Investors’ and Exporters’ (I&E) FX Window, losing 0.12per cent ($/N0.51) to close at an average of $/N410.36 in April 2021 from $/N409.85 recorded in March 2021, and trading within a range of $/N 405.00 and $/N438.00 in April

“Similarly, the Naira depreciated against the Dollar in the parallel market, losing 0.05% ($/N0.25) to close at an average of $/ N484.25 in April 2021 from $/ N484.00 recorded in March 2021.

“Consequently, the average spread between the exchange rates in the formal (I&E FX Window) and unregulated (parallel) FX markets reduced by $/ N0.26 to $/ N73.89 in April 2021, from $/ N74.15 recorded in March 2021.”

In the OTC FX Futures market, the near month contract (NGUS APR 28, 2021) with a total outstanding notional value (NV) of $0.75billion matured and was settled, whilst a new long-term (60M4 ) contract, NGUS APR 29, 2026 was introduced at a Futures price of $/N613.33

According to the report, “The total NV of open OTC FX Futures contracts as at April 30, 2021 stood at c.$4.63billion representing a further decrease of 9.04per cent ($0.46billion) from its value as at March 31, 2021 and continuing its downward trend since May 2020.”