SAT, MAY. 13 2023-theGBJournal |Nigeria’s FX reserve recorded a decline this week, as gross reserves fell by US$34.19 million w/w to US$35.22 billion (10 May). As predicted, the FX liquidity issues continues to dog the market given the tepid accretion to the reserves.
Meanwhile, the naira was flat at N462.33/US$ at the I&E window (IEW), with total turnover at the window (as of 11 May 2023) increasing by 61.2% WTD to US$540.07 million, as trades were consummated within the N460.00 – N480.50/USD band.
In the Forwards market, the rate depreciated across the 1-month (-0.9% to NGN474.19/USD), 3-month (-4.1% to N518.44/USD), 6-Month (-3.1% to NGN557.64/USD), and 1-year (-4.9% to N597.61/USD) contracts.
Meanwhile, The overnight (OVN) rate was depressed for most of the week, as the system remained awash with liquidity, with additional inflows from OMO maturities (N5.00 billion).
However, the late CRR debit triggered the OVN rate to expand by 125bps to 12.6% this week. We highlight that the system liquidity averaged a net long position of N660.01 billion this week (vs a net long position of N313.87 billion in the previous week).
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