Naira pares gains as weekly forex liquidity loses 33%

The Nigerian currency lost some of its recent gains against the dollar this week as liquidity in the official foreign exchange market dropped by a third, data from Lagos-based securities exchange FMDQ shows.

The average Nigerian Autonomous Foreign Exchange Fixing rate was N1,486.37 per dollar compared to N1,412.03/$ last week.

The total turnover in the FX spot and derivatives markets fell to $1.22 billion from $1.82 billion last week.

The FX spot turnover declined to $1.22 billion from $1.8 billion.

FMDQ said the decrease in FX derivatives turnover was solely driven by the 88.02% ($14.70 million) decrease in FX forwards turnover, while there was continued lack of activity in both the Exchange-Traded FX Futures and Cleared Naira-Settled Non-Deliverable Forwards markets.