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Naira Feels Effect of $3bn Injection, Gains at Official Market

By Adedapo Adesanya

The $3 billion emergency loan secured by the Nigerian National Petroleum Company (NNPC) Limited from the Africa Export-Import Bank (Afreximbank) on Wednesday bolstered the Naira against the US Dollar at the Investors and Exporters (I&E) segment of the foreign exchange (FX) market on Friday.

The credit facility, which would be repaid from the proceeds of crude oil sales in Nigeria, was obtained by the oil firm to stabilise the local currency, which was losing its value at the parallel market because of a forex liquidity crisis.

On Thursday, the Central Bank of Nigeria (CBN), as part of an effort to arrest the situation, said from August 31, importers would have to use a price verification system portal to access FX.

The system will help to check round tripping and enable transparency in forex transactions, as it will have details of how customers obtained the foreign currencies and at what rate.

This move by the apex bank strengthened the domestic currency at the official market yesterday as it gained N1.15 or 0.15 per cent against the greenback to close at N739.52/$1 compared with the preceding day’s rate of N740.67/$1.

However, in the Peer-to-Peer (P2P) window, the Nigerian currency lost N3 against its American counterpart to sell at N844/$1, in contrast to Thursday’s value of N841/$1.

Also, in the black market, the Naira depreciated against the US Dollar during the session by N5 to quote at N845/$1 compared with the previous day’s rate of N840/$1.

The local currency was positive against the Pound Sterling in the spot market yesterday as it improved its value by N3.66 to finish at N948.07/£1 compared with Thursday’s rate of N951.73/£1 and chalked up N3.20 against the Euro to settle at N809.42/€1 versus N812.62/€1.

The digital currency market remained under pressure yesterday as  China’s property developer, Evergrande Group, filed for Chapter 15 bankruptcy protection in the US.

Also, Mr Elon Musk’s SpaceX wrote down the value of its Bitcoin (BTC) holdings by $373 million and sold an unspecified amount, depleting the token by 2.3 per cent to $25,880.91 on Friday.

Ethereum (ETH) shed 2.1 per cent to $1,657.284, Solana (SOL) slumped by 2.3 per cent to $21.54, Litecoin (LTC) dropped 1.9 per cent to sell at $63.93, Binance Coin (BNB) depleted by 1.3 per cent to $215.26, Cardano (ADA) declined by 0.7 per cent to $0.2612, and Ripple (XRP) slipped by 0.08 per cent to $0.504.

Conversely, Dogecoin (DOGE) appreciated by 2.2 per cent to $0.0635, while Binance USD (BUSD) and the US Dollar Tether (USDT) finished flat at $1.00 apiece.

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