Naira drops slightly at the black market, breaching its support levels
The naira fell slightly on Tuesday morning to sell at a rate of N451 to $1 at the black market as against N450 to $1 recorded on Monday, showing a differential of one naira.
It should be observed that the naira has been hitting record lows on the parallel and over-the-counter spot markets since early March when the Central Bank of Nigeria (CBN) adjusted the value of the naira by 15%.
However, lately, Nigeria’s local currency, maintained stability against the American dollar at the parallel segment of the foreign exchange market, in recent days, Nigeria’s currency remained at N450 to $1 for the past 10 days refusing to breach the N450 support levels until now.
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Meanwhile, a Forex dealer at a leading tier 1 bank talked about the fundamentals expected to happen at the spot market. He said:
“The CBN will sustain its interventions in various windows with probable injection of $80million to Invisibles and SME (Small Medium Enterprises) segment at $/₦383.75 while the CBN will conduct its Bi-weekly Retail SMIS Auction on Friday with stop rate at $/₦365 for 180-day forward.
“The scarcity of funds in the Investors’ and Exporters’ FX window will persist this week as the current depressed yield in the Fixed Income is unattractive to entice fresh inflows from foreign portfolio investors amidst significant convertibility risk and negative real return.
“Naira will trade at sub $/₦390 levels through-out the week.”