Naira appreciates as bitcoin rallies above $50,000

The exchange rate between the naira and the US dollar closed at N414.73/$1 at the official Investors and Exporters (I&E) window.

Naira appreciated against the US dollar on Thursday to close at N414.73/$1, representing a 0.09% gain when compared to N415.1/$1 recorded in the previous trading session. This is despite the significant fall in the volume of forex turnover at the official window. FX turnover dropped by 49.9% on Thursday to $107.92 million.

On the other hand, naira fell marginally against the US dollar on Thursday at the parallel market to close at N572/$1, from an average of N571/$1 recorded in the previous day. This is according to information obtained from BDC operators interviewed by Nairametrics.

Nigeria’s foreign reserve reduced by 0.03% on Wednesday, 22nd December to close at $40.6 billion compared to $40.61 billion recorded as of the previous day. The continuous decline in the nation’s external reserve is attributed to the intervention by the apex bank in the official forex market.

Trading at the official NAFEX window

The exchange rate at the Investors and Exporters window closed at N414.73/$1 on Thursday, which represents a 0.09% appreciation compared to N415.1/$1 recorded a day before.

The opening indicative rate closed at N413.77/$1 on Thursday, which represents a 27 kobo appreciation compared to N414.04/$1 recorded in the previous trading session.

An exchange rate of N444.04/$1 was the highest rate recorded during intra-day trading before it settled at N414.73/$1, while it sold for as low as N405/$1 during intra-day trading.

Forex turnover at the official window fell by 49.9% to $107.92 million on Thursday, 22nd December 2021.

According to data tracked by Nairametrics from FMDQ, forex turnover at the I&E window decreased from $215.29 million recorded on Wednesday 22nd December 2021 to $107.92 million on Thursday 23rd December 2021.

Bitcoin price crosses $50k

The cryptocurrency market resumed trading activities on Friday on a positive note with the market capitalization gaining a marginal 0.42% to stand at $2.392 trillion, after bitcoin crossed the $50k mark with a gain of 0.26% to trade at $50,975.83.

Ethereum on the other hand, recorded a decline in price of 0.61% to trade at $4,088.69 while Solana dipped by 0.84% to trade at $188.5475.

Meanwhile, former U.S. President Donald Trump has said that crypto is “a very dangerous thing.” Commenting on cryptocurrencies, he warned of “an explosion someday” that will “make the big tech explosion look like baby stuff.” He also talked about his new social media platform, Truth Social, and his wife’s non-fungible token (NFT) venture.

However, Nigeria has been rated the second country most interested in bitcoin, despite the difficulty of accessing the trillion-dollar crypto in the country.

Crude oil price

As of the early hours of Friday morning, Brent Crude was trading bearish with a 0.49% decline to trade at $76.47 per barrel, while West Texas Intermediate (WTI) gained 1.42% to trade at $73.79 per barrel

On the flip side, natural gas recorded a downturn of 6.16% to trade at $3.731 per barrel while heating oil gained by 1.02% to trade at $2.331. Opec basket on the other hand closed flat at $74.23 per barrel.

Nigerian crude oil, Brass RIver and Qua Iboe also closed positive with 1.74% gain to trade at $76.09 per barrel. Bonny Light also gained 2.03% to trade at $75.75 per barrel.

The bullish trades in recent session comes of the back of the API estimated inventory draw of 3.67 million barrels, taking the year-to-date drawback to 65 million barrels for the U.S. This has caused a buy interest in the global crude oil market, pushing the price of a barrel of oil above the $75 mark.

On the other hand, South Korea is set to release 3.17 million barrels of its oil reserves in the first quarter of 2022 as part of the U.S.-led global effort by major oil-consuming nations to lower prices by pumping oil into the market.

External reserve

Nigeria’s external reserve dipped marginally by 0.03% on Wednesday, 22nd December 2021 to close at $40.6 billion, which represents a decline of $10.4 million compared to $40.6 billion recorded as of the previous trading day.

The decline in the country’s reserve level can be attributed to the continuous intervention of the apex bank in ensuring the stability of the exchange rate. The exchange rate at the official window as remained stable in the past four trading sessions.

It is worth noting that the nation’s foreign reserve had gained $5.99 billion in the month of October, as a result of the $4 billion raised by the federal government from the issuance of Eurobond in the international debt market.

In the month of November, Nigeria’s external reserve lost $633.47 million in value as against a gain of $5.99 million recorded in the previous month and $2.76 million gain in September 2021. So far in the month of December, the reserve level has lost $586.79 million, while on a year-to-date basis, the reserve gain has reduced to $5.23 billion.

 

 

 

 

Ime N