Nigeria's forex shock resulting from the 70% precipitous fall in the price of oil (Q2'20) has reinforced the CBN's resolve to ration forex in defense of the Naira. This has forced most importers to blend their forex from various sources at a rate higher than the converging rate of exchange of N381/$.
Oil prices strengthened again on hopes of a slowdown in coronavirus transmission in the United States. "The fact that the COVID cases seem to be tapering off in the U.S. is making people a little more optimistic about getting it under control and demand recovering toward the end of the year," said Michael Lynch, president of Strategic Energy & Economic Research.
The FGN Bonds market opened the day with wide spreads as market participants reacted negatively initially to the released April FGN Bond circular, which showed the DMO increasing the offered amount by N20bn across the offered tenors.