The official international trade market, the Nigerian Autonomous Overseas Change Market, witnessed a 40.46 per cent drop in turnover to $4.37bn (N4.03tn) in January from $7.34bn recorded in December 2023.
In keeping with the most recent Monetary Markets Month-to-month Report issued by FMDQ, which homes the NAFEM, the US greenback appreciated in opposition to the naira, with the spot trade fee growing by 10.44 per cent ($/N93.66) to shut at a median of $/N990.96 in January 2024 from $/N897.30 recorded within the earlier month.
The report added that trade fee volatility elevated in January 2024 because the naira traded inside an trade fee vary of $/N838.95 – $/N1,482.57 in comparison with $/N806.73 – $/N1,099.05 recorded in December 2023.
The report additional famous that the market turnover in January 2024 was N7.19tn, representing a month-on-month lower of 55.92 per cent (N9.12tn) from the turnover recorded in December 2023 (N16.31tn).
FMDQ famous that the MoM lower within the FI market turnover was pushed by 62.31 per cent (N3.24tn), 2.54 per cent (N0.06tn), 79.50 per cent (N3.49tn), 53.27 per cent (N2.28tn) and 59.45 per cent (N0.05tn) lower in turnover throughout Treasury Payments, OMO Payments, CBN Particular Payments, FGN Bonds and Different Bonds, respectively.
“Consequently, the buying and selling depth for T.Payments and FGN Bonds decreased MoM by 0.56bps and 0.11bps to 0.30 and 0.10, respectively T.payments and FGN Bonds throughout the >6M – 12M and >20Y tenors respectively had been probably the most traded sovereign FI securities, accounting for 35.86 per cent (N1.42tn) and 26.52 per cent (N1.05tn) of the secondary market turnover for sovereign FI securities within the spot market,” the report mentioned.
In keeping with the report, whole turnover within the cash market phase decreased MoM by 21.45 per cent (N1.54tn) to N5.64tn in January 2024.
In the meantime, whole turnover within the FX derivatives market phase in January 2024 was $4.56bn (N4.21 trillion), representing a MoM lower of 29.52 per cent ($1.91bn) from the December 2023 figures.
The Change mentioned that the MoM decreases within the FX derivatives turnover had been collectively pushed by the 27.67 per cent ($1.71bn), 62.50 per cent ($0.15bn), and 100.00 per cent ($0.05bn) lower in FX Swaps, FX Forwards and FX Futures transactions, respectively.
On Wednesday, the naira depreciated marginally in opposition to the greenback to N1,605.74 on the official market from N1,602 recorded the day before today.
The drop on Tuesday marks a second-day decline after final week’s win in opposition to the buck be aware, indicating that demand pressures persist within the foreign exchange market as provide stays inadequate.
This decline coincides with the announcement from the cryptocurrency buying and selling platform, Binance, that it’ll stop buying and selling actions involving the Nigerian foreign money.
Binance was accused of exploiting the Nigerian foreign money, Naira, resulting in its free fall in worth. The corporate is, as well as, going through allegations of terrorism financing, cash laundering and tax invasion, amongst others.
At above N1,600/$1, the trade fee between the naira and greenback is down by 43 per cent in 2024 and stays one of many worst currencies in Sub-Saharan Africa. That is regardless of a number of coverage measures launched by the apex financial institution to resolve the foreign exchange disaster.
