Monday, 13th September 2021: The exchange rate between the naira and the US dollar closed at N412.75/$1, at the official Investors and Exporters window.
Naira depreciated further against the US dollar on Monday, to close at N412.75/$1 as against the N412/$1 recorded at the close of trade on Friday, 10th September 2021, representing a 0.18% drop.
The exchange rate at the parallel market hit a new all-time low on Monday to close at N550/$1 compared to N545/$1 recorded in the previous trading session. This represents a 0.92% depreciation and further widens the gap between the black market rate and the official rate.
READ: Who will save the Naira?
The local currency continues its unprecedented fall at the black market following CBN’s actions to channel forex demand away from the window and buyers scramble to buy the scarce dollars.
Currency speculators are taking advantage of the huge exchange rate difference between the official market and the black market.
The slump at the black market comes on the heels of increased forex demand pressure and a sharp decline in dollar supply.
Individuals and businesses have to rely on the black market for their foreign exchange requirements because the banks appear to be rationing dollars. The apex bank’s plan to curtail the illegal market by banning sales to money traders and reprimanding people who profit from the arbitrage seems not to be working and dealers are speculating the currency will weaken further.
The Central Bank of Nigeria had earlier stated that it is closely monitoring the forex transactions of banks operating in the country and warned them against all forms of malpractices threatening that those found culpable would have their foreign exchange operating licenses suspended for at least a year.
Trading at the official NAFEX window
The exchange rate depreciated against the US dollar on Monday 13th September 2021 to close at N412.75 to a dollar, representing a 75 kobo drop compared to N412/$1 recorded in the previous trading day.
The opening indicative rate closed at N412.46/$1 on Monday, 13th September 2021, a N1.21 gain when compared to N411.25/$1 recorded on Friday, 10th September 2021.
An exchange rate of N414 to a dollar was the highest rate recorded during intra-day trading before it settled at N412.75/$1, while it sold for as low as N404/$1 during intra-day trading.
Meanwhile, forex turnover at the Investors and Exporters (I&E) window rose by 83.08% on Monday, 13th September 2021.
According to data tracked by Nairametrics from FMDQ, forex turnover increased from $88.39 million recorded on Friday to $161.82 million on Monday 13th September 2021.
The world’s largest and most popular cryptocurrency, Bitcoin, was up by 1.32% to trade at $45,394.26 early on Tuesday morning after dropping on Monday.
Cryptos had earlier crashed on Monday after Walmart said that a widely reported press release announcing it would accept crypto payments was fake saying it doesn’t plan to start accepting Litecoin.
The global crypto market cap inched up to $2.07 trillion compared to the last day. However, the total crypto market volume jumped as much as 23% to $135.74 billion.
The second-largest cryptocurrency by market capitalization, Ethereum was up by 2.15% to trade at $3,309.51 early on Monday; in the same vein, XRP was up by 1.08% to trade at $1.08.
The Chairman of Nigeria’s Economic and Financial Crimes Commission, Abdulrasheed Bawa has hit on the risk associated with Bitcoin and other cryptocurrencies to the world economy. According to him, many criminals now play significant roles in crypto-currency markets, adding that virtual currencies had become their preferred medium of exchange.
Crude oil price
Crude oil prices went up with Brent crude rising by 0.78% to trade at $74.08 per barrel on shocking OPEC report.
OPEC on Monday said that the surge of the Delta variant around the globe is set to partially delay oil demand recovery into the next year when robust economic growth and stronger recovery in fuel consumption will see global oil demand averaging 100.8 million barrels per day (bpd) and exceeding pre-Covid levels, raising its 2022 demand forecast by a shocking 900,000 bpd.
This year, total global oil demand remains unchanged at 96.7 million bpd for the whole of 2021. But the fourth-quarter demand was revised slightly down, by 110,000 bpd from the August estimate of 99.82 million bpd to 99.7 million bpd now, OPEC said in its September report.
The WTI rose by 0.81% to trade at $71.02 per barrel, the Nigerian headline crude, Bonny Light was up by 0.98% to trade at $72. However, OPEC Basket was up by 0.22% to trade at $71.98, while Natural Gas declined by 0.65% to trade at $5,197 after rising earlier.
Nigeria’s foreign reserve rose by $80 million to close at $34.859 billion on Friday, 10th September 2021, compared to $34.779 billion recorded as of the previous day. The latest increase represents a 0.23% boost in the country’s foreign reserve.
The reserve has now gained $841.56 million in the month of September, reducing the year-to-date loss to about $510 million compared to $35.37 billion recorded as of 31st December 2020.
Meanwhile, recent reports have suggested that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021, the recorded growth in the country’s foreign reserve position could be a positive step towards hitting the projected target.