Naira crashes further as CBN injects $1.47bn into FOREX market

Naira closed trading significantly weaker to the dollar at the official market on Tuesday.

Data from the FMDQ Security Exchange showed the Naira closed at N411.67 to the US dollar.

Tuesday’s exchanged rate at the Investors and Exporters window showed Naira lost N1.67 or 0.41 percent in value compared to N410.00, the rate it closed on Monday and Friday last week.

Although dollar supply in the market increased significantly, market participants bid for the dollar at the rate of N410.10 and N436.55, before closing at N401.10.

The market witnessed a forex turnover increase by 2.04 percent, with $48.42 million recorded as against the $47.45 million posted on Monday.

However at the black market, Nigeria’s naira remained unchanged against the U.S. dollar.

According to the data posted by Aboki FX, naira again closed at N485, the same rate it has exchanged for the last six days.

Meanwhile, to defend Naira, the Central Bank of Nigeria (CBN) injected $1.47 billion into the foreign exchange market in January.

According to CBN economic report, this was a decrease of 47.4 percent and 64.0 percent from the level in the preceding month and corresponding period of 2020.

“The total foreign exchange sales to authorised dealers by the bank was $1.47bn in January 2021, a decrease of 47.4 percent and 64.0 percent from the level in the preceding month and corresponding period of 2020, respectively.”

“A disaggregation showed that foreign exchange sales at the I&E, SMIS, SME, and interbank fell by 79.9 percent, 38.3 percent, 19.8 percent, and 37.3 percent to $0.22bn, $0.48bn, $0.10bn, and $0.04bn respectively.

“Similarly, foreign exchange cash sales to BDC operators and matured swap transactions fell by 19.3 percent and 48.7 percent, compared with its level in the preceding month to $0.42bn and $0.12bn respectively in the review period,” CBN said.