FX market liquidity drops as traders shun derivatives: FMDQ data

Liquidity in the Nigerian foreign exchange market dropped 7.66 percent this week as traders steered clear of derivatives including forwards contracts, leaving the naira little changed against the dollar.

The total turnover in the FX spot and derivatives markets fell to $1.49 billion from $1.62 billion last week, according to data from securities exchange FMDQ.

It said decrease in total turnover was driven solely by FX spot transactions, “as there were no FX derivatives transactions” during the week.

The average Nigerian Autonomous Foreign Exchange Fixing was N1,646.72 per dollar, compared to N1,647.91/$ recorded in the previous week.