Total turnover trade on Investors & Exporters Foreign Exchange (I&E FX) window hits $14.69 billion in four months, between July and September 2017, as Central Bank of Nigeria (CBN) continued to bridge the gap between parallel market and official market rates.
In our fact findings, we observed that the I&E FX in October rose by 7.3 per cent to $4.53 billion from $4.22 billion in September 2017. In the I&E FX window for August moved to $3.68 billion, an increase of 62.8 per cent from $2.26 billion in July.
FMDQ OTC had reported that 10 commercial bank traded N70.88trillion overall turnover on the FMDQ OTC Securities Exchange between January to September 2017. Meanwhile, the apex bank has defended the local currency with $4.8billion between July and October this year, our correspondent can report.
Data gathered by our correspondent revealed that the apex bank highest intervention in four months under review was $1.5 billion in August, followed by $1.37 billion in October. The CBN had defended the Naira with $1.2 billion and $727.5 million in September and July of 2017 respectively.
For the first three months, the CBN’s $1.37billion in October comprises of $400 million in whole sale; $200million in Small and medium enterprises (SMEs); $180 million in invisibles; $306.3million in SMIS, and $285.70 million in agriculture, airlines, petroleum, and raw materials segments.
In September, the apex bank injected $485 million to Retail Secondary Market; SMEs, $300 million; invisibles $255 million and $200 million, to wholesale segments. The bulk of the disbursement totaling $561 million in August was injected to the clearance of the backlog of matured foreign exchange obligations for raw materials and machineries for manufacturing companies, agricultural chemicals, and airlines – was for Retail Secondary Market Intervention Sales (SMIS), while the balance went to settling wholesale, $500 million; SMEs, $235 million, and invisible $200 million, demands.
The CBN’s Acting Director, Corporate Communications Department, Mr. Isaac Okorafor continued to reiterate that its intervention was in line with the CBN’s commitment to continue to ensure foreign exchange liquidity and meet legitimate demand.
He maintained that the CBN will continue to intervene in the nation’s foreign exchange Market in order to sustain the liquidity in the market and guarantee the international value of the Naira. The Naira at the foreign exchange continued on a gainer side over CBN’s weekly intervention.
Explaining the present foreign exchange market rates, Researchers at Cordros Capital said, “the Naira was up 0.55 per cent against the Dollar at N363 in the parallel market. The Naira against the Dollar traded lower in the parallel market relative to the I&EFX widow during the period, although with a lower spread (60basis points), compared to the previous month (128basis points). This reflects a convergence of rates in the two segments.
“We think it likely that the naira trades within its current band across markets in November, with continued accretion to the foreign reserves (four per cent m/m)–on the back of rising oil price and improved domestic production–reassuring market participants of dollar liquidity in the system.”