Naira depreciates against Dollar at official window

Naira depreciated against the US dollar on Monday to close at N414.40/$1, representing a 0.02% drop when compared to N414.30/$1 recorded on Friday, 8th October 2021.

Similarly, the exchange rate at the parallel market closed at N564.5/$1. This is according to information obtained from BDC operators in Lagos.

The local currency hit as high as N420.50 at the official market earlier in the day, as the forex shortages still persist.

The opening indicative rate closed at N413.53/$1 on Monday, representing a 91 kobo gain when compared to N414.44/$1 recorded the previous trading day.

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An exchange rate of N420.50 to a dollar was the highest rate recorded during intra-day trading before it settled at N414.40/$1, while it sold for as low as N404/$1 during intra-day trading.

According to data tracked from FMDQ, forex turnover declined from $359.48 million recorded on Friday to $184.31 million on Monday, 11th October 2021.

Nigeria’s foreign reserve gained $203 million on Friday, 8th October 2021 to close at $38.387 billion compared to $38.184 billion recorded as of the previous day. The latest increase represents a 0.53% increase in the country’s foreign reserve.

The reserve gained a record $2.76 billion in the month of September 2021, while the recent gain puts the year-to-date gain at $3.01 billion. It is also worth noting that Nigeria’s reserve has gained over $1.59 billion in just 5 days into October 2021.

The recent increase in the reserve position, which has continued since the 25th of August, is in line with recent reports suggesting that Nigeria’s foreign reserve position could grow as high as $40 billion by the end of September 2021.

Although the reserves did not hit $40 billion as predicted in the previous month, it continues to record positive growth and could cross the predicted line by the end of the month, if it maintains this trajectory.

The reserve is further boosted by the receipt of $3.35 billion special drawing rights (SDR) allocation from the International Monetary Fund (IMF) which the Federal Government hopes to use to reduce budget deficits.