The Nigerian Autonomous Foreign Exchange (NAFEX) widow has received not less than $3.373 billion in just three weeks, indicating high level of investors’ confidence in the nation’s foreign exchange market, investigation by The Daily Times has revealed.
In view of this, many financial experts and dealers believe that the newly introduced investors’ Forex window has successfully reversed the zero level of investors’ confidence to utmost height, just as it recorded a total turnover of $1.246.36bn in the trading week ended Friday, October 20, 2017.
Two weeks ago, NAFEX had declared a lesser closing figure of $954.76 million, which was the total traded volume between Monday, October 9 and Friday, 13, 2017.
But the autonomous FX segment had a better transacted volume of $1.172bn earlier in the month, between Tuesday, October 3 and Friday, October 6 this year.
The breakdown of the investors special window transactions put the just concluded trading week on the positive trend with traded volume of $1.246.36, while first trading day during the week stood as the second lowest figure for the week with $167.71m.
It, however, moved significantly to close the second day trading activities to $268.18m; and was seen stronger on Wednesday with daily turnover of $328.01m, which was the highest in the week under review before dropping to $326.03 on Thursday; and the lowest on Friday, with $156.43m transactions.
But the previous week had declared $954.76m volume, which represented the weakest figure sold during the considered weeks, with first day transactions put to $207.26m, before dropping to $86.69 million the following day, but rebounded on Wednesday to close at $240.54m, again moved up to $252.56 on Thursday, however, closed that week low with $167.71m traded volume.
The first week out of the considered weeks recorded an improving turnover of $1.172bn in just four trading days. The local currency at the autonomous FX window commenced first trading day of the week on Tuesday, due to the closure of the official forex market on Monday for the Independence holiday declared by the Federal Government of Nigeria, with an opening rate of 359.76 per dollar against 359.89 sold last Tuesday, while closing at 360.40 compared to 360.31 traded the corresponding period in preceding week.
The breakdown of the NAFEX transactions put Tuesday, October 3 daily turnover to $340.07m, which was stronger than $238.98m declared the same period in the corresponding week.
Therefore, gaining further the following day with an opening rate of 359.40 to the US Dollar compared to 359.76 and a lower closing rate of 360.07, against 360.05 traded the previous Wednesday, but declared an appreciable traded volume of $257.56 against $238.98million a week before.
On Thursday, the autonomous FX window opened for trading at a slight depreciated rate of $359.65 against 359.40 a day earlier but stronger than 359.66 of the previous week.
The local currency then closed at 360.33 compared to Wednesday 360.07 and 360.00 traded in the corresponding period of the week under review. However, it declared an appreciable daily turnover of $367.44m compared to $257.56 recorded the previous day, better than $340.07m traded on Tuesday; and $299.94m declared in the corresponding period a week ago.
The Importer and Exporters forex window, which was believed to have boosted investors’ confidence since its creation by the CBN in April, this year on Friday began the last trading day with an opening rate of 359.24 against 359.65 and 359.45 recorded a week ago but closed on a downward trend of 360.64 weaker than 360.33 on Thursday and 360.40 sold in previous week.
The special forex window, however, closed the week low to put volume traded at $207.26m, representing the weakest turnover for the week, while comparing with Tuesday $340.07, Wednesday $257.56 and Thursday $367.44m, data obtained from FMDQ OTC official website.
Due to the achievement recorded during short time of the NAFEX establishment, financial experts and forex dealers believe that the newly introduced forex has reversed the zero level confidence of investors to highest level of confidence in the Nigerian economy. Meanwhile, during the same period, the nation’s external reserves defied all critics to touch almost highest in three years to stand at $33.11bn.
The latest reserves balance represented the same level last seen since December 2014, but began its rebounded journey few months ago, The Daily Times check has revealed.
Earlier this month, precisely October 3, 2017, the foreign reserves stood at$32.740bn against the balance of $32.046bn on September 19, representing total growth of $693.704m in just11 working day.
Considering the appreciating level in the first week, our correspondent observed that the reserves recorded just $274.873m, while comparing $32.321bn on September 26, 2017 with $32.046bn a week earlier before extending the gains by $418.831m in the second week to have less than $700m appreciation.
In the recent time, the apex bank has continued its sustained liquidity injection to the foreign exchange market by weekly injection of dollars into the Nigerian inter-bank foreign exchange market.
To this end, the Acting Director, Corporate Communications Department of the CBN, Mr. Isaac Okorafor, has said that the apex bank would continue to increase liquidity, aimed at meeting genuine demand in the market to enhance forex stability.
