Money Market accounts for 61% of total turnover
FMDQ Securities Exchange has declared a total transactions turnover of N11.78 trillion in fixed income and currency (FIC) markets for the month of May 2020.
This is contained in a monthly FIC report obtained from FMDQ on Wednesday, indicated that the turnover represented a decrease of 29.46 per cent, when compared with N16.70 trillion in April.
Analysis of the figure, also, showed that the turnover recorded in the FIC markets in May 2020, was the lowest turnover recorded since January 2018 (N11.71trillion).
Breakdown of the figure, however, showed that Money Market comprising repurchase agreements and unsecured placements transactions and open market operations bills drove the total FIX market turnover in May, accounting for 61.26 per cent.
This development means that money market transactions replaced foreign exchange (FX) as the highest contributor to FIC markets turnover during the month under review.
On the other hand, the FX market turnover during the period, stood at $7.62 billion (N2.94 trillion), representing a decline of 32.92 per cent or $3.74 billion from $11.36 billion or N4.38 trillion posted in April.
Further analysis of the FX market turnover indicated a general decrease in FX market activity by trade type, with Member-Client trades accounting for 55.61 per cent ($2.08 billion) of the total MoM decrease in FX turnover.
However, FX Derivatives accounted for 89.30 per cent ($3.34 billion) of the total MoM decrease in FX turnover by product type in May 2020.
It is noteworthy to mention that the turnover for Member-CBN FX Spot trades increased by 100 or cent MoM from 0.16 billion dollars in April to 0.32 billion dollars in May.
In May, the Naira depreciated against the United States dollar at the Investors’ and Exporters’ FX Window by N1.18 to close at an average of N386.17.
Also, in the parallel market, the naira depreciated against the U.S dollar by N22.37 to close at an average of N450 during the review period.