Despite a minor influx of foreign currency (FCY) into external reserves, the Nigerian naira gave up the struggle to recoup losses experienced against the dominating US dollar across the foreign exchange markets.
Nigeria got a $331 million inflow, increasing its total position to $33.954 billion, according to records of foreign currency transactions. The Central Bank of Nigeria (CBN) has officially launched its pricing verification webpage for foreign exchange (FX) consumers to register.
The gateway, according to local deposit money institutions, would be required for foreign currency processing and sales to consumers who fulfill mandated conditions, such as tax clearance certificates.
The Naira has declined more against the US dollar, according to traders, with the exchange rate falling to N762.71 from N738.18 at the investors and exporters FX window.
As currency speculators consolidate their positions despite a widening spread between official and open market prices, FX consumers diverted forex demand to the parallel market, leading the local currency to decline more.
The currency rate fell by 0.54% to N925 on the parallel market. Due to poor earnings from crude oil exports, the Nigerian naira is under immense pressure as a result of currency scarcity in the face of increased demand.
Crude oil prices jumped on Thursday in the worldwide market, with Brent crude rising 1.17% to $86.24 per barrel and West Texas Instruments (WTI) crude rising 1.60% to $82.94 per barrel.
The increases were driven by a stronger demand expectation following a massive crude inventory decrease of 10.6 million barrels in the United States, exceeding a total of 3.3 million barrels. Additionally, there are growing expectations that OPEC and its allies will agree to extend their production cuts.
Nigeria’s sovereign dollar bonds fell by as much as 2.4 cents on Thursday, Tradeweb data showed, as markets reacted to reports that a $3 billion loan to state oil company NNPC was in limbo. The 2038 maturity fell by the most, losing 2.4 cents, but its other U.S. dollar bonds also slid by more than 2 cents, Tradeweb data showed.
