Naira Loses 12- Day Stability
Stories by Ayodele Aminu
As anticipated last Tuesday, the Nigerian currency, the naira, lost its 12 - day stability yesterday at the Dutch Auction System (DAS) following the continuous pressure on demand for foriegn exchange lately.
At the close of business yesterday, the naira lost 4 kobo to close at N132.84 per dollar.
According to the summary of the trading session, the amount offered by the apex bank on Thursday was $100 million, while the total amount demanded by 57 banks on behalf of their customers was $124,089,377.63, out of which bids amounting to $98,325,783.48 were successful.
Unsuccessful bids amounted to $20,454,948.16, while unfunded accounts and disqualified bids were $231,981.02 and $5,076,664.97 respectively.
The $98,325,783.48 sold to banks yesterday by the apex bank is $7.26 million or 6.87 per cent less than the $105,589,272.79 sold in the previous trading session, while $124,089,377.63 demanded is $20.98 million or 14.4 per cent less than the $145,076,862 demanded in the previous trading day.
Further analysis of the trading results shows that the highest bid rate moved up from N129 to N133.85 per dollar but the lowest bid rate fell slightly from N132 to N130.95 per dollar.
Reasons given by the apex bank for declaring some of yesterday's bids as unsuccessful range from low bid rates; incomplete address; no registered company number; unclear purpose as well as unfunded account.Cumulatively, the$98,325,783.48 sold to banks the banking watchdog yesterday, brings to $24.97 billion the total amount of foreign exchange that has been sold to banks by the CBN since the debut of the DAS July 22, 2002.
Similarly, the N100 million offered to banks yesterday, brings the total amount of foreign exchange that has been offered since the commencement of the new trading system to $18.87 billion.
At the export proceeds market, the average naira exchange rate at the close of work yesterday stood at N133.45 per one United States dollar.
At the parallel market, the average naira exchange rate averaged at N138.00 per dollar at the close of business yesterday.
At the Nigeria Inter-bank Foreign Exchange Fixing (NIFEX) where the market quotes represent rates at which $1 million and above are traded amongst banks in the inter-bank foreign exchange market, the bid and offer rates of one United States dollar stood at N133.108/133.408 at the close of business yesterday.
Thirty days spot fixing had swap points of 2.0874/2.0921 with forward fixings of 135.1957/135.5004 while 60 days spot fixing had swap points of 4.1693/4.1787 with forward fixings of 137.2776/137.587. Ninety days spot fixings had swap points of 6.2458/6.2599 with forward fixings of 139.3541/139.6682, while 180 days spot fixing had swap points of 12.4428/12.4709 with forward fixings of 145.5511/145.8792
At the Nigeria Inter-bank Offered Rate (NIBOR) where the quotes represent rates at which large amounts (N100 million and above) are traded among banks in the inter-bank market, 7 days tenored funds traded at 18.8333 per cent per annum while 30, 60, 90, 180, 270, and 365 days traded at 20.4167, 21.3333, 21.3750, 20.6250, 0.0000 and 20.4167 per cents respectively at the close of business yesterday.
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