Naira loses N5.08 as dollar liquidity dries up despite rising reserves
By Aboki Forex —
The naira fell across foreign exchange market segments last week as dollar liquidity weakened. This happened even as Nigeria's external reserves continued to rise.
Data from the Central Bank of Nigeria showed the naira depreciated by N5.08 week on week at the Nigerian Foreign Exchange Market. It closed at N1,363.83 per dollar on Thursday, the last trading day before the June 12 public holiday. That was a 0.4 percent decline from N1,358.75 quoted the previous Thursday.
On a day on day basis, the local currency weakened by N1.78 from N1,362.05 recorded on Wednesday. Over the four trading days of the week, the naira lost 99 kobo from N1,362.84 quoted on Monday.
Trading activity at the interbank FX market also slowed. The number of deals dropped by 30.58 percent week on week to 84 on Thursday, down from 121 the week before. Compared with Wednesday's 109 deals, activity fell by 22.94 percent.
Turnover at the interbank segment fell sharply to $70.42 million on Thursday from $128.17 million on the same day the previous week. That was a 45.06 percent decline.
At the NFEM window, transaction volumes held relatively steady. The number of deals stood at 332 on Wednesday, compared with 314 deals during the same period the previous week. However, activity eased slightly on a day on day basis from 336 deals recorded on Tuesday.
Total turnover at the NFEM window settled at $607.89 million on June 11.