The Naira on Friday, November 18, traded flat at both the Interbank and parallel segment of the foreign exchange markets maintaining stability against the Dollar.
Also the Central Bank of Nigeria, CBN, spot rate was stable on all trading days of the week, closing at N305.25/$ on Monday, before depreciating marginally to N305.50/$ towards the end of the week.
Afrinevst analysts said: “Our expectations of further fragmentation of the FX market and a liquidity constraint at the parallel market materialised as black market operators refused to sell dollars at the regulatory mandated rate of N400.00/$1 but willing to buy at N395/$1, most likely to hoard.”
“However, naira/dollar rate at the underground parallel market for operators willing to defy regulatory directives on rate traded between N455.00/$ and N465/$ during the week without liquidity constraints.”
“In the futures market, total value of open contracts stood at $3.8billion as at Friday 18th November. We observed that investors are subscribing more to the longer dated Naira settled OTC futures contracts which are attractively priced.
We expect the CBN to fulfil its obligation on the maturing NGUS NOV 23 2016 futures contract and also replace it with a NOV 2017 instrument in line with recent trend.
“In the interim, we expect that developments in the FX market will be at the vanguard of discussions at the MPC meeting.
The analysts opined that the issues in the market will continue to intensify peradventure status quo remains on the management process of the FX market.
