cSupply Gap Widens in Forex Market – Thisday

The naira depreciated against the US dollar at all the foreign exchange market segments last week as dollar liquidity remained tight at the interbank market.

On the interbank market, the naira fell against the greenback by N13.18 to close at N321.16 to a dollar last Friday, as against the N307.98 to a dollar it attained the preceding Friday, amid strain in dollar supply as the Central Bank of Nigeria (CBN) did not intervene in the market. The naira even fell as low as N330/$1 during the week.

Meanwhile, the CBN settled N962.23million in matured 1-month futures contract, being total settlement amount to its banking counterparties at N279/USD last Wednesday.

The expired contract, according to analysts at Cowry Asset Management Limited, was replaced by a new one year contract, Naira-Dollar JUL 19 2017, with a total notional amount on offer of $1 billion at N250/$1.

Forex traders were said to have executed 51 deals worth $189.37million between last Monday and Thursday.

On the other hand, the naira also depreciated at the Bureaux De Change (BDC) and the parallel market arms of the market by 1.37 per cent and 0.80 per cent to N370/$1 and N378/$1 respectively as unmet dollar demand continued to spill into the alternative market segments.

Read more at http://www.thisdaylive.com/index.php/2016/08/01/csupply-gap-widens-in-forex-market/