The Naira appreciated on Monday by N5 to close at N480 per US dollar, as against N487 to a dollar it exchanged for when the foreign exchange market closed last week.

 

The Naira had exchanged at N485 against the dollar for about two weeks, but fell on Friday to N487 at the parallel market, as the greenback scarcity worsened ahead of the Christmas celebration.

 

The currency also appreciated slightly against the Pound Sterling and the Euro, closing at N605 and N510 respectively, compared to N607 and N513 it traded over the weekend.

 

At the Bureau De Change window, the Naira closed at N399 to a dollar, CBN-controlled rate, while the Pound Sterling and the Euro traded at N606 and N515 respectively.

 

The Naira remained stable at the inter-bank market, trading at N305 to a dollar.

 

Meanwhile, traders said that the demand for dollars was putting pressure on the Naira US$1billion futures contract to be opened as naira falls to pressure

 

There are high expectations that the Naira-Dollar December 21 2016 contract will be maturing, and that this will be replaced with a new instrument with total value of US$1.0 billion, one dealer revealed.

 

The Naira-settled Over-the-Counter (OTC) foreign exchange (FX) Futures product, whilst of tremendous benefit to Nigerian corporates, according to experts, is of immense importance and advantage to the CBN, the Nigerian FX market, and the nation’s economy as a whole.

 

The OTC FX Futures market serves to minimise the imbalance in the Spot FX market and cause the rate to moderate; attract significant capital flows to the Nigerian fixed income and equity markets; and achieve exchange rate stability.

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