Please see below commentary on the Foreign Exchange (FX) market with data  for  the week-ended July 2, 2021. The table following the commentary compares Spot FX weekly turnover for trades between banks (FMDQ Dealing Member (Banks) [DMBs]/Authorised Dealers) and their clients for the week ended June 25 & July 2, 2021.

• In the FX Spot, Forwards and Futures markets, the total turnover for the week-ended July 2, 2021, was $767.44 million, representing a decrease of 5.02% ($40.58 million) from $808.02 million reported for the week-ended June 25, 2021. The week-on-week (WoW) decrease in turnover was jointly driven by the 4.11% ($25.24 million) and 7.90% ($15.34 million) decrease in the FX Spot and FX Derivatives turnover, respectively. (See Table 1 below)

• The WoW decrease in FX Derivatives turnover was driven by the 19.79% ($22.29 million) decrease in FX Futures turnover, resulting in a 0.73 percentage points decrease in FX Derivatives’ contribution to total FX market turnover from 24.04% recorded in the previous week to 23.31%
• In the Investors’ & Exporters’ (I&E) FX market, the total value of transactions for the week-ended July 2, 2021, was $588.54 million, representing a decrease of 4.11% ($25.24 million) from the value of transactions executed in the week-ended June 25, 2021 ($613.78 million)

Table 1: Weekly FX Turnover Analysis

• For the week-ended July 2, 2021, the average Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate was $/N410.74, compared to $/N410.85 recorded in the previous week-ended June 25, 2021, representing an appreciation of the Naira against the United States (US) Dollar by 0.03% ($/N0.11)
• In the parallel market, the Naira depreciated against the US Dollar by 1.21% ($/N6.00) to close the week-ended July 2, 2021, at an average exchange rate of $/N500.00, compared to $/N494.00 in the previous week. Consequently, the spread between the average parallel market exchange rate and NAFEX rate increased WoW by 7.34% ($/N6.11) to $/N89.26 in the week-ended July 2, 2021, from $/N83.15 recorded in the previous week. (See Table 2 below)

Table 2: Weekly FX Rate Analysis

In the FX Futures market, $90.35 million worth of FX Futures contracts were traded in thirteen (13) deals, representing a WoW decrease of 19.80% ($22.30 million) when compared to $112.65 million traded in eleven (11) deals recorded in the week-ended June 25, 2021

Still in the FX Futures market, the 60th FX Futures contract, NGUS JUN 30 2021, matured and settled on FMDQ Exchange on Wednesday, June 30, 2021. The quotes for all sixty (60) monthly contracts are published daily on FMDQ’s website and via FMDQ Group’s twitter handle @FMDQGroup