SAT 26 JUNE, 2021-theGBJournal- Nigeria’s FX reserves sustained its decline, dipping USD215.62 million w/w to USD33.55 billion (24th June 2021), the lowest in 13 months.
Analysts believe the Central Bank of Nigeria’s resumption of interventions in April in both the spot and forward may have influenced the recent run in depletions of the reserves.
Meanwhile, the naira depreciated by 0.2% to NGN411.67/USD and 0.4% to NGN500.00/USD at the I&E window (IEW) and parallel market, respectively.
At the IEW, total turnover (as of 24th June 2021) increased by 2.7% WTD to USD580.84 million, with trades consummated within the NGN401.00 – 420.80/USD band. In the Forwards market, the rate depreciated across the 1-month (-0.3% to NGN413.10/USD), 3-month (-0.4% to NGN417.16/USD), 6-month (-0.5% to NGN422.19/USD) and 1-year (-1.1% to NGN433.54/USD) contracts.
Analysts at Cordros Research expects improved liquidity in the IEW over the medium term, given the expectation of increased oil inflows in line with the rise in crude oil prices, and (2) inflows from FCY borrowings.
‘’Accordingly, we expect the naira to remain relatively range-bound (NGN410.00/USD – NGN415.00/USD) at the IEW.’’
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