Nigeria's one-year currency forward posted its biggest fall in more than 10 years on Monday and stocks fell to an eight-year low after the central bank adjusted the naira's official rate.
The currency in Nigeria, which relies on oil sales for 90% of foreign exchange earnings, has suffered since crude prices plunged following a disagreement between Russia and Saudi Arabia over output cuts and a slide in global demand.
The Nigerian central bank quoted the naira at 360 to the dollar on Monday, weaker than its previous peg of 306, while the rate on the interbank market moved to 380 from 360 previously.
Central Bank Governor Godwin Emefiele said in a tweet that the currency move was a price adjustment, not a devaluation.
The naira's one-year forward price, which gives an indication of where the currency could trade in a year's time, fell 11.3% against the dollar.
The non-deliverable forwards (NDF) market in London priced the naira at 515 to the dollar in a year's time while naira futures contracts of the same tenor were quoted at 385.
Credit: The post Nigerian Naira Forwards Slump after Central Bank Adjusts Currency Rate first appeared in Reuters on March 23, 2020.