Exchange rate strengthens at NAFEX as dollar supply spikes by 690%
- 9th April 2021
- Posted by: Hakeem
- Category: Currencies
Thursday, 8th April 2021: The exchange rate between Naira and the US Dollar closed at N409.65/1$ in the Importers and Exporters window, where forex is traded officially.
Naira gained against the US Dollar on Thursday to close at N409.65/$1. This represents a 0.33% appreciation compared to N411/$1 recorded on Wednesday.
Meanwhile, naira remained stable in the parallel market on Thursday, 8th April 2021 to close at N485 to a dollar, the same rate as maintained since last week.
Trading at the official NAFEX window
Naira appreciated against the US Dollar at the Investors and Exporters window on Thursday to close at N409.65 to a dollar. This represents a N1.35k gain when compared to N4111/$1 recorded on Wednesday, 7th April 2021.
- The opening indicative rate closed at N410.5 to a dollar on Thursday. This represents a N0.76 depreciation when compared to N409.74/$1 recorded on Wednesday.
- Also, an exchange rate of N419 to a dollar was the highest rate recorded during intra-day trading before it closed at N409.65/$1. It also sold for as low as N394/$1 during intra-day trading.
- Forex turnover at the Investor and Exporters (I&E) window increased by 690.6% on Thursday, 8th April 2021.
- A cursory look at the data tracked by Nairametrics from FMDQ showed that forex turnover grew from $11.85 million recorded on Wednesday, April 7, 2021, to $93.69 million on Thursday, April 8, 2021.
The world’s most popular digital currency, bitcoin recorded a 0.18% decline in value in the early hours of Friday, 9th April 2021.
- Bitcoin was down by 0.18% to trade at $58,135 on Friday morning, bur lead compared to $36,199 recorded at the close of trade on Wednesday.
- Meanwhile, according to a research report, bitcoin is expected to surge around 600$ to hit the $400,000 level in 2021. This has been well met as major financial institutions in the world such as Visa, Goldman Sachs, and Morgan Stanley have embraced the digitalization of money.
- The digital currency has been widely adopted by many, replacing gold as the global digital-reserver asset.
Oil price gain
Brent crude oil price recorded a marginal increase on Thursday as it closed at $63.2 per barrel, indicating a 0.06% gain compared to $63.16 recorded at the close of trade on Wednesday.
- Crude oil prices are beginning to record tepid growth demands are expected to increase due to revived optimism in the market as the United Kingdom has given the first vaccine to about half of its population, while the US has vaccinated about 30% of its population.
- Crude oil prices have recorded a marginal increase during the week despite the resolve of the OPEC+ to reduce production cuts in the coming months. However, US Shale Giant have commended the OPEC+ group in bringing supply and demand back to balance.
- Brent Crude closed at $63.2 (+0.06%), WTI Crude closed at $59.75 indicating 0.25% gain, Bonny Light, $60.6 (-2.63%), OPEC Basket (-1.06%) to close at $60.68 while Natural gas dipped by 0.12% to close at $2.519.
Nigeria’s external reserve gained $1.79 million on Thursday, 8th April 2021 to close at $34.977 billion, being the highest external reserve position recorded in over a month.
- This indicates a 0.01% increase when compared to $34.975 billion recorded on Thursday 1st April 2021.
- This also represents an increase in the country’s external reserve position for the 12th consecutive day, having endured a significant downturn in the early parts of the year. Nigeria’s reserve has added a total of $560.5 million in 12 days.
- This recent increase in Nigeria’s external reserve could however be attributed to the increase in crude oil prices recorded earlier in March before the recent bearish trade in the crude market.
- It could be attributed to the possible increase in diaspora remittance as the CBN offers incentives for every unit of dollar received in Nigeria from diaspora remittance.