The Nigerian naira faced a decline against the US dollar in the official market as banks reported a reduction in foreign exchange (FX) sales on Thursday.
Data from the Financial Markets Dealers Quotations (FMDQ) revealed that the amount of dollars sold by banks, as well as willing buyers and sellers, decreased by 6.13 percent, dropping to $321.23 million from the previous day’s $342.22 million.
Following Thursday’s trading activities, the naira depreciated by 4.10 percent, with the dollar quoted at N1,479.47 compared to N1,418.78 recorded on Wednesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
The intraday high closed at N1,504 per dollar, showing a slight improvement from N1,510 on Wednesday, while the intraday low weakened to N946.82 per dollar, down from N896.28/$1 the previous day.
Meanwhile, in the money market, the Nigerian Treasury Bills (NT-Bills) secondary market ended on a negative note, witnessing a surge in average yields across the curve, according to a report from FSDH research. The average yield surged by 261 basis points (bps) to reach 14.99 percent, with short-term and medium-term maturities experiencing significant expansions.
The Central Bank of Nigeria (CBN) conducted its scheduled Primary Market Auction on February 7, offloading NT-Bills valued at N1,000.00 billion across varying tenors. Despite the higher stop rates, the auction witnessed robust demand, with bid-to-cover ratios settling at 0.20x (91-day), 0.38x (182-day), and 3.11x (364-day), indicating strong investor appetite.
In the Open Market Operations (OMO) bills market, there was a slight positive sentiment, as the average yield across the curve dipped by 1 basis point to close at 10.07 percent. The long-term maturities also saw a marginal decline of 1 basis point.
These developments highlight the dynamic nature of Nigeria’s debt market, with investors closely monitoring fluctuations in yields amid evolving economic conditions.