Naira strengthens at NAFEX window despite 79.3% drop in dollar supply

Thursday 25th February 2021, The exchange rate between the naira and the US Dollar closed at N408.67 to a dollar at the Investors and Exporters window.

Naira appreciated marginally against the US Dollar on Thursday as it closed at N408.67/$1 at the NAFEX window. This represents a 0.03% gain compared to N408.8 recorded on the previous day.

On the other hand, the exchange rate remained stable in the parallel market, closing at N480/$1 on Thursday, the same as recorded on Wednesday.

However, forex turnover at the Investor and Exporters (I&E) window decreased by 79.3% from $212.43 million recorded on Wednesday to $43.97 million on Thursday 25th February 2021.

Trading at the official NAFEX window

Naira appreciated against the US Dollar in the Investors and Exporters window on Thursday, as it closed at N408.67/$1. This represents a 0.03% gain when compared to N408.8/$1 recorded a day earlier.

  • The opening indicative rate closed at N409.16 to a dollar on Thursday. This is an improvement of 0.34% compared to N409.5/$1 recorded on Wednesday.
  • Also, an exchange rate of N415 to a dollar was the highest rate during intra-day trading before it closed at N408.67/$1. It also sold for as low as N382/$1 during intra-day trading.
  • Forex turnover at the Investor and Exporters (I&E) window decreased by 79.3% on Thursday, February 25, 2021.
  • Forex turnover decreased from $212.43 million recorded on Wednesday, February 24th, 2021, to $43.97 million on Thursday, February 24th, 2021.

Cryptocurrency watch

The world’s flagship crypto, bitcoin recorded a sharp decline on Thursday, as it dipped about 5.7% to close at 47,521 as at the time of writing this article.

  • According to a new study conducted by, the total number of global cryptocurrency users has hit 106 million for the first time ever, representing a 15.7% increase compared to December 2020 figures.
  • The study also outlined factors contributing to the rising demand for cryptocurrency worldwide. Apart from the growth bitcoin has enjoyed recently, others include the growth of the decentralized finance market, the ability to transact using Paypal, and the adoption of cryptos by institutional investors.
  • Meanwhile, the Governor of Nigeria’s Apex bank, Godwin Emefiele while addressing the Senate reiterated that cryptocurrency threatens Nigeria’s financial system and must remain under quarantine indefinitely.
  • He also stated that cryptocurrency has no place in our monetary system at this time and such transactions should not be carried out through the Nigerian banking system.

Oil price dip marginally on account of pullbacks

Brent crude oil price dipped by 0.56% on Thursday 25th February 021 to close at $66.88 per barrel compared to a record high of $67.26 recorded a day earlier.

  • Crude oil prices went back and forth during the course of the trading session on Thursday as pullbacks from traders waiting to see how the inventory situation in America plays out eventually saw the price of oil record a decline.
  • Also, Exxon Mobil, one of the world’s largest publicly traded international oil and gas company has decided to sell its production assets in the UK’s central and northern North Sea to a private equity firm, Hitec Vision for a total of over $1 billion
  • Meanwhile, the Minister of Finance, Budget and National Planning, Dr. Zainab Ahmed has described the recent rise in the price of crude oil in the global market as a welcome development.
  • She stated that gaining more revenue from the sale of crude oil will yield more revenue for the government as well as reduce the country’s rate of borrowing.
  • Brent crude closed at $66.88, WTI ($63.29), OPEC Basket ($64), Bonny Light ($65.36), and Natural gas ($2.764).

Steady decline in external reserves

Nigeria’s external has declined by 0.15% to stand at $35.17 billion as of February 24th 2021 compared to $35.23 recorded as of 23rd February.

  • This indicates that Nigeria has lost a total of $1.13 billion in external reserve positive in the month of February.
  • According to data obtained from the Central Bank of Nigeria (CBN), external reserves declined from $36.3 billion as of 29th of January 2021 to $35.17 billion as of 24th of February.
  • It is however worth noting that the decline in Nigeria’s external reserve has persisted despite growth recorded in global oil prices as crude prices have grown to about $67 per barrel from $55.04 recorded as at the end of January.

Leave a Reply

Your email address will not be published. Required fields are marked *