SAT 09 APRIL, 2022-theGBJournal| Nigeria’s FX reserves increased by USD84.25 million w/w to USD39.63 billion (6th April 2022).
Given inflows from the recently issued Eurobond and the IMF’s SDR, we think the CBN has enough supply to support the FX market over the short term.
Nevertheless, we note that foreign inflows are paramount for sustained FX liquidity over the medium term, in line with our expectation that accretion to the reserves will be weak given that crude oil production levels remain pretty low.
Meanwhile, the naira was flat at N416.67/USD at the I&E window (IEW) but appreciated by 0.2% to NGN587.00/USD at the parallel market.
At the IEW, total turnover (as of 7th April 2022) declined by 23.1% WTD to USD528.14 million, with trades consummated within the NGN410.00 – NGN453.15/USD band. In the Forwards market, the naira appreciated at the 1-month (+0.1% to NGN418.00/USD) and 6-months (+0.1% to NGN432.61/USD) contracts but was flat at the 3-months (N424.02/USD) and 1-year (N448.85/USD) contracts.
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