Naira on Thursday strengthened further against the dollar, gaining N0.33k as the foreign exchange market closed at N457 from N457.33k on Wednesday on the black market.
The foreign exchange has been under intense pressure since March 2020 following sharp drop in the oil prices due to outbreak of Covid-19 pandemic.
At the Bureau De Change (BDC) segment of the foreign exchange naira was stable as the dollar was sold at N457 on Wednesday.
At the Investors and Exporters (I&E) forex window, Naira appreciated by 0.04 percent as the dollar was quoted at N385.83 as against the last close of N386.00.
Analysts at FSDH research said most participants maintained bids between N384.00 and N386.00 per dollar.
The analysts said the Central Bank of Nigeria (CBN) has been reluctant to intervene actively in the different segments of the markets following the significant decline in FX reserves in April 2020. Nevertheless, a loan of $3.4 billion from the IMF has supported accretion in the FX reserves. The expected inflows from the World Bank ($1.50 billion) and African Development Bank ($211.50 million) could further support FX reserves in the midst of a relatively low-interest-rate environment.
At the money market, the Nigerian treasury bills market closed on a positive note on Thursday with average yield across the curve declining by 4 bps to close at 1.42 percent from 1.46 percent on the previous day. Average yields across short-term and long-term maturities compressed by 3 bps and 7 bps, respectively due to maximum buying interest witnessed in the NTB 16-Sep-21 (-26 bps), NTB 9-Sep-21 (-22 bps), and NTB 29-Oct-20 (-17 bps) maturity bills. However, the average yields across medium-term maturities widened by 1 basis point.
In the Open Market Operation (OMO) bills market, the average yield across the curve declined by 24 bps to close at 1.47 percent on Monday as against 1.71 percent on the previous day. Buying interest was seen across short-term and medium-term maturities with average yields falling by 42 bps and 18 bps respectively, while selling pressure was witnessed across long-term maturities with the average yield rising by 3 bps. The highest yield increase was seen in the 7-Sep-21 maturity bill, which rose by 19 bps, while the highest yield decline was witnessed in the 19-Jan-21 maturity bill, which fell by 82 bps.
