The Nigerian currency, the Naira, on Monday rallied stronger and appreciated by N2, amid sustained slide in the price of crude oil at the international market.
The Central Bank of Nigeria closure of the foreign exchange trading window for Bureau de-Change increased the pressure on the Naira.
In spite of the day’s appreciation, the gap between the official and unofficial rates deepened further by 36.4 per cent.
Crude oil currently sells at $35.4 per barrel in the international crude oil market, while CBN has closed the foreign exchange trading platform for BDC, until January 5, 2016.
Available data from the parallel market at the end of trading showed that the Naira gained N2 to trade at N270 to the dollar from N272 it closed on Friday, December 18, 2015.
A currency dealer in Lagos, Harrison Owoh, attributed the Naira’s relative gains to CBN’s effective control over limited foreign exchange, administrative exclusion of about 2,881 BDC operators and the closure of foreign currency window until January 5.
Mr. Owoh said the combined effects of the CBN monetary policy had to a large extent saved the Naira from the market-induced free falls.
Another currency dealer in Lagos, Safianu Abubarka, said the movement of the Naira around N270 at the parallel market followed the high supply of dollars in the market.
“It is normal at this time of the year for the parallel market to be awash with foreign currencies because of the number of Diaspora Nigerians visiting for the Christmas and New Year holidays.
“If the trend we are seeing today continues, the Naira will likely appreciate further to about N200,” Ms. Safianu predicted.
Meanwhile, Nigerian equities market rallied marginally on Monday, as the Nigerian Stock Exchange all-share index appreciated by 0.72 per cent.
The market had on Friday, amid the nation’s sustained economic challenges, dipped by 1.54 per cent.
At the end of trading, the Exchange ASI grew by 191.28 points to close at 26,728.64 points compared with 26,537.35 points achieved on Friday.
The market capitalisation also rose by N70 billion to close at N9.19 trillion against N9.12 trillion recorded on Friday.
With market growth, its investors’ Year-to-Date, YTD, returns stands at 22.88 per cent.
However, the market breadth closed in the positive territory with Dangote Cement leading the price gainers, chalking up N2.04 to close at N152.05 per share.
GTB share price also grew by 95k to close at N20, while Union Bank gained 28k to close at N5.98 per share.
West African Portland Cement, WAPCO, gained 25k to close at N92.25 per share, while the share price of Ecobank International appreciated by 7k to close at N17.70.
Conversely, Nestle led the losers table, shedding N10 to close at N790 per share.
Mobil Oil share price dipped by N5.84 to close at N120 while Flour Mills lost N1.05 to close at N19.95 per share.
UAC of Nigeria share price also fell by 25k to close at N18.75, while Custodian Insurance lost 17k to close at N4.01 per share.
The market turnover closed on a negative note as overall volume declined by 59.20 per cent to against 186.26 per cent recorded on Friday.
In all, investors bought 195.98 million shares worth N2.39 billion, traded in 2,387 deals.