Nigeria’s naira weakened in the official market Monday as the reported parallel-market premium widened, while two reports put the country’s Nov. 6 foreign reserves at different levels.
The Central Bank of Nigeria (CBN) recorded the Nigerian Foreign Exchange Market (NFEM) rate at 1,349.34 naira per dollar Monday, up from 1,346.79 Friday, Nov. 6. The CBN identifies the NFEM rate as the official figure for each day and says it uses a volume-weighted average.
The daily move followed a week of differing results across markets. The Financial Markets Dealers Association (FMDA) said its official-market rate strengthened 0.34% over the week to 1,347.64 naira per dollar on Nov. 6. In the parallel market, the naira weakened 1.38% to 1,410.60 per dollar, FMDA said. It put the gap between the markets at 62.96 naira, compared with about 39 naira a week earlier.
BusinessDay reported a parallel-market quote of 1,415 naira per dollar Monday, up from 1,408 Friday. The outlet did not specify whether the quote was for buying or selling. Using BusinessDay’s quote and the CBN’s official rate, the difference was 65.66 naira, or about 4.87% of the official rate. NigeriaGalleria listed Monday’s dollar price at 1,415 naira to buy and 1,428 to sell. EconoTimes previously covered the widening foreign-exchange premium between Nigeria’s official and parallel markets.
Reserve reports also differed. FMDA put reserves at $55.133 billion on Nov. 6, down 0.16% from a week earlier, and said reserves above $55 billion marked their highest level since December 2008. BusinessDay reported $55.06 billion for Nov. 6, a 0.36% weekly decline. The CBN’s reserve series labels its displayed movement a 30-day moving average.
The CBN says reserve management supports confidence in exchange-rate policy and helps preserve its ability to intervene in the foreign-exchange market and meet Nigeria’s external obligations. FMDA’s report also lists a Treasury-bill auction for Nov. 11, with an 800 billion naira offer and settlement on Nov. 12.