skrimon
Active Member
Foreign exchange turnover rose to a whopping $227 million on Wednesday, the highest daily turnover in over two months.
Nigeria’s exchange rate at the NAFEX window depreciated marginally closing at N386 during intraday trading on Wednesday, August 19, 2020. In contrast, the exchange rate at the parallel market gained on Wednesday as it closed at N477/$1.
Forex Turnover: Forex turnover at the Investor and Exporters (I&E) window recorded a massive gain on Wednesday, August 19, 2020, as it increased by a record 1132.6% a day on day.
According to the data tracked by PipsWin.com from FMDQ, forex turnover increased from $18.44 million on Tuesday, August 18, 2020, to $227.29 million on Wednesday, August 19, 2020.
The record dollar supply at the forex market represents a clear departure from the low liquidity and the volatility that has characterized the market for some months.
CBN’s intervention in the foreign exchange market could be to meet the increased dollar demand due to the anticipated resumption of international flight operations.
Although there was a record increase in forex turnover for the day, the volatility of the foreign exchange market and the scarcity of the greenback is expected to persist. This is due to low oil prices and low foreign capital inflow into the country.
The average daily forex sale for last week was about $24 million which represents a significant drop from the $50.6 million that was recorded the previous week. The remarkable FX turnover represents the first time it hit the $200 million mark since January 2020.
Total forex trading at the NAFEX window in the month of July was $937 million compared to $875 million in June.
The exchange rate disparity between the official NAFEX rate and the black-market rate has remained as wide as N91.
Nigeria maintains multiple exchange rates comprising the CBN official rate, the BDC rates, SMIS, and the NAFEX (I&E window).
The wide disparity between the 2 rates has created huge arbitrage opportunities for some highly connected individuals.
Cheers!
Nigeria’s exchange rate at the NAFEX window depreciated marginally closing at N386 during intraday trading on Wednesday, August 19, 2020. In contrast, the exchange rate at the parallel market gained on Wednesday as it closed at N477/$1.
Forex Turnover: Forex turnover at the Investor and Exporters (I&E) window recorded a massive gain on Wednesday, August 19, 2020, as it increased by a record 1132.6% a day on day.
According to the data tracked by PipsWin.com from FMDQ, forex turnover increased from $18.44 million on Tuesday, August 18, 2020, to $227.29 million on Wednesday, August 19, 2020.
The record dollar supply at the forex market represents a clear departure from the low liquidity and the volatility that has characterized the market for some months.
CBN’s intervention in the foreign exchange market could be to meet the increased dollar demand due to the anticipated resumption of international flight operations.
Although there was a record increase in forex turnover for the day, the volatility of the foreign exchange market and the scarcity of the greenback is expected to persist. This is due to low oil prices and low foreign capital inflow into the country.
The average daily forex sale for last week was about $24 million which represents a significant drop from the $50.6 million that was recorded the previous week. The remarkable FX turnover represents the first time it hit the $200 million mark since January 2020.
Total forex trading at the NAFEX window in the month of July was $937 million compared to $875 million in June.
The exchange rate disparity between the official NAFEX rate and the black-market rate has remained as wide as N91.
Nigeria maintains multiple exchange rates comprising the CBN official rate, the BDC rates, SMIS, and the NAFEX (I&E window).
The wide disparity between the 2 rates has created huge arbitrage opportunities for some highly connected individuals.
Cheers!
