.Records transactions worth $655.7m in a day, highest in 2018
. As CBN boosts FX market with fresh $514.4m
Achievements recorded in the Nigeria’s foreign exchange market over the time has been consistently linked to the continuous high turnover at the Investors and Exporters (I&E) FX window, just as it declared a whopping total transactions worth of $1.892billion in just one week of trading, investigations by The Daily Times has revealed.
For instance, the Investors window, in just one day during the week under review, recorded a significant daily transactions turnover of $655.7million, which represented the highest amount traded since the beginning of 2018.
The breakdown of the transactions, however, showed that the I&E FX window recorded $292.15 million as at close of first trading day but dropped to $273.74 million the following day and even depreciated further to $263.57 million as of close of midweek trading activities, putting total trading from Monday to Wednesday at $929.66 million.
But the I&E FX window, otherwise known as Nigeria Autonomous Foreign Exchange ( NAFEX ) window, on Thursday, rebounded with better closing transactions figure of $306.70 million compared to the first three days within the week, before Friday’s $655.72 million, which was the highest ever traded in just single day at the autonomous FX window this year.
The trend therefore put the last two trading days figure at $962.42 million, stronger than the total exchanged figure of $929.66 million for the first three days during the week under review.
But the Central Bank of Nigeria (CBN) last Monday sustained its intervention in the forex market with $210 million into the interbank foreign exchange market, and extended its efforts to improve liquidity and alleviate dollar shortage with another fresh interventions in the Retail Secondary Market Intervention Sales (SMIS) of the forex market to the tune of $304.4 million dollars on Friday.
The latest forex intervention was said to be part of the continuous efforts by the CBN to meet customers’ requests in various segments of the forex market.
Consequently, the Naira, on Friday, at the NAFEX, opened at a stronger rate of N359. 75 to the dollar against 359.99 recorded on Thursday and Wednesday, but closed low at N360.35, compared to N360.25 sold on Thursday, after it traded high at N361 per dollar at the Investors forex segment, data obtained from the FMDQ OTC showed.
The CBN’s Acting Director, Corporate Communications Department, Mr. Isaac Okorafor, in a statement in Abuja on Friday, reiterated that the objective of the CBN remained to boost liquidity, production and trade.
He said that the recent interventions were in favour of interests in the agriculture, airlines, petroleum products, raw materials and machinery sectors.
According to him, the CBN will continue to ensure liquidity in the interbank sector of the market as well as sustain its interventions in order to drive economic growth and guarantee market stability.
Okorafor expressed optimism that the Nigerian economy stood to gain massively from the Bank’s foreign exchange management strategy.
According to him, it can be seen in the accretion to the foreign reserves, which now stands at more than 40 billion dollars.
The Daily Times recalls that the CBN had last Monday injected $210 million into the interbank foreign exchange market, as $100 million earmarked for the wholesale market, $55 million for small businesses and individuals, and $55 million for certain dollar expenses such as school fees and medical bills.
The apex bank said it “will continue to manage the forex with a view to reducing the country’s import bills and halting accretion to its foreign reserves.
Okorafor reiterated the Bank’s determination to continue to intervene in the interbank foreign exchange market, in line with its pledge to sustain liquidity in the market and maintain stability.
He said the CBN would continue to manage the forex market with a view to reducing the country’s import bills and minimise depletion of foreign reserves.
Meanwhile, investors’ confidence has continue to grow over the Nigerian foreign exchange market, since it’s creation in April 2017, due to low investors confidence and foreign exchange scarcity in 2017.
But The Daily Times checks has showed that the NAFEX window as at close of the year 2017 recorded a whopping total transactions turnover of $25.65 billion in just nine months of operations in 2017.
In fact, data obtained by The Daily Times from FMDQ OTC securities Exchange revealed that $0.61 billion or N1865.66 billion total turnover was traded in April and increased by 114 per cent to $1.32 billion or N403.92 billion in May.
Total turnover on the I&E FX window in June and July were $1.63 billion or N498.78 billion and $1.86 billion or N569.16 billion respectively.
Data from FMDQ OTC stated that total turnover gained momentum in August 2017, as newly created window reached $3 billion per month.
According to the data, I&E FX window in August was estimated at $3.54 billion or N1.08 trillion, while in September, total trade on the I&E FX window closed at $4.61 billion or N1.41 trillion.
For October, it dropped to $4.30 billion or N1.32 trillion.
In addition, the total turnover trade on the I&E FX window in November and December were $4.51 billion or N1.38 trillion and $3.27 billion or N1 trillion respectively.
The I&E FX was created by the CBN to boost supply of foreign exchange into the nation’s economy, attract more investments and stabilise the foreign exchange market.