Naira Depreciated by -2.40% WoW in the Parallel Market at an Average Exchange Rate of N512

Forex
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Monday, August 02, 2021 07:00 AM / by FMDQ/ Header Image Credit: Aboki FX


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Below is the commentary on the Foreign Exchange (FX) market with data for the week-ended July 30, 2021. The table following the commentary compares Spot FX weekly turnover for trades between banks (FMDQ Dealing Member (Banks) [DMBs]/Authorised Dealers) and their clients for the week ended July 23 & July 30, 2021.

 

  • In the FX Spot, Forwards and Futures markets, the total turnover for the week-ended July 30, 2021, was $902.45 million, representing an increase of 98.43% ($447.66 million) from $454.79 million reported for the week-ended July 23, 2021. The week-on-week (WoW) increase in turnover was jointly driven by the 80.24% ($262.81 million) and 145.25% ($184.85 million) increase in the FX Spot and FX Derivatives turnover, respectively. (See Table 1 below)

 

  • The WoW increase in FX Derivatives turnover was jointly driven by the 78.07% ($88.81 million) and 711.37% ($96.04 million) increase in FX Forwards and FX Futures turnover respectively, resulting in a 6.60 percentage points increase in FX Derivatives' contribution to total FX market turnover to 34.58%, from 27.98% recorded in the previous week

 

  • In the Investors' & Exporters' (I&E) FX market, the total value of transactions for the week-ended July 30, 2021, was $590.34 million, representing an increase of 80.24% ($262.81 million) from the value of transactions executed in the week-ended July 23, 2021 ($327.53 million)

 

 Table 1: Weekly FX Turnover Analysis


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For the week-ended July 30, 2021, the average Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate was $/N411.18, compared to $/N411.24 recorded in the previous week-ended July 23, 2021, representing an appreciation of the Naira against the United States (US) Dollar by 0.02% ($/N0.06)

 

  • In the parallel market, the Naira depreciated against the US Dollar by 2.40% ($/N12.00) for the week-ended July 30, 2021, at an average exchange rate of $/N512.00, compared to the $/N500.00 recorded in the previous week. Consequently, the spread between the average parallel market exchange rate and NAFEX rate increased WoW by 13.59% ($/N12.06) to $/N100.82 in the week-ended July 30, 2021, from $/N88.76 recorded in the previous week. (See Table 2 below)

 

Table 2: Weekly FX Rate Analysis


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  • In the FX Futures market, $109.54 million worth of FX Futures contracts were traded in nine (9) deals, representing a WoW increase of 711.37% ($96.04 million) when compared to $13.50 million traded in two (2) deals recorded in the week-ended July 23, 2021
  • Still in the FX Futures market, the 61st FX Futures contract, NGUS JUL 28 2021, matured and settled on FMDQ Exchange on Wednesday, July 28, 2021. The quotes for all sixty (60) monthly contracts are published daily on FMDQ's website.

Previous Weekly FX Market Analysis

  1. IEFX Market Total Transactions Value Decreased by $325.65m WoW, Representing 49.86% Decline - FMDQ
  2. FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 16, 2021
  3. FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 9, 2021
  4. FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 2, 2021
  5. Foreign Exchange (FX) Market Analysis for Week-Ended June 25, 2021
  6. Foreign Exchange (FX) Market Analysis for Week-Ended June 18, 2021
  7. Foreign Exchange (FX) Market Analysis for Week Ended June 11, 2021
  8. Foreign Exchange (FX) Market Analysis for Week Ended June 4, 2021

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