Business

Naira closes flat at N362/$ at Parallel Market

Published

9 years ago

May 4, 2018

Dollar inches to almost 4-month high

The Nigerian Naira at the parallel segment of the Nigerian Foreign Exchange Market, remained at the same rate at which it traded for against the United States of America Dollar, on Wednesday, May 2.

At the black market, the Naira exchanged at the rate of N362 against the greenback. Meanwhile, the local currency appreciated by 0.01% to NGN360.46 in the I&E FX window.

Growth in total turnover in the I&E FX window trended negative by 48.87% to USD185.36 million, traded within the NGN345-NGN363/USD band.

Recall that Central Bank of Nigeria, CBN, had on Wednesday, May 3, injected USD210 million into the Foreign Exchange market, allocating USD100 million to the wholesale window, and USD55 million eaxh to the SMEs and invisibles segments.

Meanwhile, on the international scene, the United States of America dollar, on Thursday, May 3, traded near a four-month high against a basket of currencies, having recovered from a brief dip after the Federal Reserve kept interest rates steady and said inflation had “moved close” to its target.

The dollar’s index against a basket of six major peers last stood at 92.645. It had slipped to around 92.245 after the Fed’s policy statement but later regained its footing to set a four-month high of 92.834 on Wednesday.

Its rate-setting committee said inflation had “moved close” to its target and downplayed a recent slowdown in economic and job growth, saying activity had been expanding at a moderate rate and job gains, on average, had been strong in recent months.

“The dollar had a slight wobble on the Fed’s latest statement…which was interpreted as dovish on the surface. But below lurked a confident sounding board,” Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore, said in a note.

The statement suggests that the Fed is confident that inflation remains on track to meet its target, he added.

“With the US economic data flow continuing to dwarf other economies around the world and mainly the EU, the dollar remains the market’s darling for the time being,” Innes said.

The dollar has been buoyed in recent weeks by the strong US economic outlook and rising yields amid signs of a slowdown in some other developed economies, especially in Europe.

The dollar eased 0.1 per cent to 109.75 yen, still not very far from a three-month high of 110.05 yen set on Wednesday.