Festive spending, election to exert forex demand pressure as FX reserves take the hit

MANUFAC TURERS HAVE COMMENCED INVENTORY build-up for festive sales and customers have begun to prepare for the festivities, this coupled with election spending could trigger forex demand pressures, according to analysts.

Already, the country’s FX reserve declined for the fourth month in a row to October, dropping $2.2 billion in October alone.

Information from the Central Bank of Nigeria (CBN) shows that the reserves shed $2.2 billion in October, moving from $44.3 billion on SepOCTOBER tember 30 to $42 billion by October 30, 2018.

The country’s foreign reserves, which swelled steadily in 2018, following improved oil prices, and hitting $47.8 billion in June, began plunging downwards suddenly, following the numerous interventions of the CBN in a bid to keep the naira stable.

The naira remained flat at N362 in the parallel market.

A business a.m. survey of street markets in Ikeja, showed similar trading the dollar was sold at N361/ N362 throughout the week and was bought at N360 per dollar, the British pound sterling and euro sold at N470 and N412 respectively, compared to N480 and N420 from the close of the previous week.

At the Bureau De Change (BDC) window, the Naira also traded stable at N360 to the dollar and was bought at N359, while the Pound Sterling and Euro closed at N472 and N416 respectively as traders bought the pounds at N462 and the Euro at N406.