SAT. 03 NOV, 2022-theGBJournal| Nigeria’s FX reserve recorded another decline for thirteen consecutive weeks, dipping by USD59.56 million w/w to USD37.11 billion (30 November).
Across the FX windows, the naira appreciated by 0.2% to N445.33/USD at the I&E window (IEW).
At the parallel market the Naira closed at an average N735/$ Friday.
At the I&E window, total turnover (as of 01 December 2022) fell by 14.8% WTD to $460.25 million, with trades consummated within the N410.00 – 444.00/US$ band.
In the Forwards market, the rate weakened at the 1-month (-1.8% to N460.03/USD), 3-month (-2.7% to N471.58/USD), 6-Month (-3.1% to N491.30/USD) and 1-year (-4.3% to N473.02/USD) contracts.
Meanwhile, this week, the overnight (OVN) rate expanded by 38bps to 13.0%, as the inflows from FGN bond coupon payment (N5.63 billion) and OMO maturities (N25.00 billion) were insufficient to sustain the system liquidity.
Notwithstanding, we note that the average system liquidity settled higher, printing a net long position of N146.41 billion (vs a net long position of N24.11 billion in the previous week).
Barring any significant inflow to the financial system coupled with expected outflows for (NTB, OMO & FX) auctions next week, we expect the OVN rate to trend upward from current levels.
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