SAT 09 JAN, 2021-theGBJournal- Nigeria’s FX reserves maintained its ascent, as it grew by USD341.74 million w/w to USD35.72 billion (5th January 2021).
Across the FX windows, the naira strengthened against the US dollar by 4.3% w/w, to NGN393.50/USD at the I&E window, and weakened by 0.4% to NGN472.00/USD in the parallel market.
In the Forwards market, the rates appreciated on the 1-month (+5.2% to NGN397.97/USD), 3-month (+6.2% to NGN403.33/USD), 6-month (+6.7% to NGN417.92/USD) and 1-year (+9.6% to NGN435.87/USD) contracts.
‘’Given the expected pressure on the external reserves amid weak portfolio inflows, we expect the naira to depreciate closer to its fair value implied by long-run REER (NGN453.67) in the medium term,’’ Cordros Research analysts said.
‘’Our baseline expectation is that the CBN will depreciate the naira by 5.3% to NGN400/USD in the interbank market and 5.1% to NGN415/USD at the IEW.’’
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