Naira Depreciated at the Parallel Market by -1.02% WoW to N515.80 from N510.60

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Monday, August 23, 2021 / 07:00 AM / by FMDQ / Header Image Credit: The Cable


Below is the commentary on the Foreign Exchange (FX) market with data for the week-ended August 20, 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 August 13 & 20, 2021.

 

  • In the FX Spot and Derivatives markets, the total turnover for the week-ended August 20, 2021, was $539.47 million, representing a decrease of 22.11% ($153.13 million) from $692.60 million reported for the week-ended August 13, 2021. The week-on-week (WoW) decrease in turnover was driven by the 24.56% ($135.09 million) and 12.66% ($18.04 million) decrease in the FX Spot and FX Derivatives turnover, respectively. (See Table 1 below)

 

  • Despite the WoW decrease in FX Derivatives turnover, which was jointly driven by the 4.92% ($6.44 million) and 100.00% ($11.60 million) decrease in FX Forwards and FX Futures turnover respectively, FX Derivatives' contribution to total FX market turnover increased to 23.06%, from 20.57% recorded in the previous week

 

  • In the Investors' & Exporters' (I&E) FX market, the total value of transactions for the week-ended August 20, 2021, was $415.05 million, representing a decrease of 24.56% ($135.09 million) from the value of transactions executed in the week-ended August 13, 2021 ($550.14 million)

 

 Table 1: Weekly FX Turnover Analysis

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For the week-ended August 20, 2021, the average Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate was $/N411.22, compared to $/N411.17 recorded in the previous week-ended August 13, 2021, representing a depreciation of the Naira against the United States (US) Dollar by 0.01% ($/N0.05)

 

  • In the parallel market, the Naira depreciated against the US Dollar by 1.02% ($/N5.20) for the week-ended August 20, 2021, at an average exchange rate of $/N515.80, compared to the $/N510.60 recorded in the previous week. Consequently, the spread between the average parallel market exchange rate and NAFEX rate increased WoW by 5.18% ($/N5.15) to $/N104.58 in the week-ended August 20, 2021, from $/N99.43 recorded in the previous week. (See Table 2 below)

 

Table 2: Weekly FX Rate Analysis

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  • In the FX Futures market, there were no trades executed in the week-ended August 20, 2021
  • Still in the FX Futures market, the 62nd FX Futures contract, NGUS AUG 25 2021, is set to mature and settle on FMDQ Exchange on Wednesday, August 25, 2021. The quotes for all sixty (60) monthly contracts can be found on the FMDQ Website

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Previous Weekly FX Market Analysis

1.   NAFEX Rate Depreciated by -0.003% WoW to N411.17 from N411.16

2.  Naira Appreciated by 0.23% WoW in the Parallel Market at an Average Exchange Rate of N510.80

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

4.  IEFX Market Total Transactions Value Decreased by $325.65m WoW, Representing 49.86% Decline - FMDQ

5.  FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 16, 2021

6.  FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 9, 2021

7.  FMDQ Foreign Exchange (FX) Market Analysis Report for Week-Ended July 2, 2021

8. Foreign Exchange (FX) Market Analysis for Week-Ended June 25, 2021

9. Foreign Exchange (FX) Market Analysis for Week-Ended June 18, 2021

10. Foreign Exchange (FX) Market Analysis for Week Ended June 11, 2021

11.  Foreign Exchange (FX) Market Analysis for Week Ended June 4, 2021

 

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