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Dollar Drops on Yellen Comments, China Shares Rise

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Dollar
  • Dollar Drops on Yellen Comments, China Shares Rise

The dollar weakened after Janet Yellen said it’s prudent for the Federal Reserve to gradually adjust policy over time, while Chinese equities extended gains as the world’s second-largest economy grew faster than forecast. Gold climbed for a second day.

The greenback slipped against major peers after the Fed chief’s speech. The Shanghai Composite Index rose the most in almost two weeks as China’s gross domestic product accelerated for the first time in two years in the final quarter of 2016. Japan’s Topix index swung within a half-percentage-point range, while equities from Hong Kong to Jakarta slipped. Gold headed for a fourth straight weekly advance as investors await the opening days of Donald Trump’s presidency.

Rallies in the dollar and equities are easing this week before Trump is sworn in as the 45th American president, with investors growing increasingly anxious for indications the administration will follow through on pro-growth campaign promises. Legendary billionaire investor George Soros said the euphoria among stock investors since Trump’s victory will end as uncertainty takes over. The Dow Jones Industrial Average has churned in its tightest range ever over the past month.

“It’s clear that investors have reached a level where they are prepared to wait and see what the Trump administration has to offer,” said Ric Spooner, chief market analyst at CMC Markets Asia Pacific Ltd. in Sydney.

In a speech at the Stanford Institute for Economic Policy just a day before Trump’s inauguration in the U.S., Yellen argued that the Fed wasn’t behind the curve in containing inflation pressures but nevertheless can’t afford to allow the economy to run too hot. In a separate speech on Wednesday, Yellen said the Fed was close to achieving its goals of full employment and stable prices. The odds of another Fed rate hike as soon as May have risen to 50 percent from 42 percent a day ago, futures contracts show.

China’s economic data cemented an economic stabilization that’s giving leaders a buffer as they transition to neutral policy and prepare for potential trade tensions with Trump. GDP increased 6.8 percent in the three months through December from a year earlier, compared with a 6.7 percent median estimate in a Bloomberg survey.

Here are the main moves in markets:

Currencies

  • The Bloomberg Dollar Spot Index retreated 0.3 percent as of 12:41 p.m. in Tokyo, after gaining as much as 0.1 percent earlier. The gauge is down 0.2 percent for the past five days, heading toward its fourth straight weekly loss. It touched the highest level in more than a decade earlier this month.
  • The yen added 0.2 percent to 114.60 per dollar, wiping out a decline of 0.2 percent and almost reversing a loss for the week. The Australian dollar climbed 0.3 percent, also erasing earlier losses.

Stocks

  • The MSCI Asia Pacific Index rose 0.3 percent, with about 500 stocks declining and 360 advancing.
  • The Topix index fell as much as 0.2 percent and climbed as much as 0.3 percent. The gauge is headed for its fourth weekly decline in the past five weeks.
  • The Shanghai Composite gained 0.5 percent. Hong Kong’s Hang Seng index fell 0.7 percent.
  • Australia’s S&P/ASX 200 Index slipped 0.5 percent, heading toward the biggest weekly decline since early December.
  • Futures on the S&P 500 Index rose 0.1 percent. The underlying cash index fell 0.4 percent to the lowest in two weeks on Thursday. The Dow declined for a fifth straight day, the longest losing streak since Trump’s election victory.

Commodities

  • Gold rose 0.3 percent to $1,208.09 an ounce, on course for a fourth weekly climb. It’s up 0.9 percent this week, touching the highest level since November.

Bonds

  • The yield on 10-year Treasuries fell two basis points to 2.45 percent, retreating after a two-day rally.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Naira

Daily Naira Exchange Rates (Parallel Market, Bureau De Change and CBN Rates); Friday, January 15, 2021

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Nigeria 500 naira notes

Daily Naira Exchange Rates (Parallel Market, Bureau De Change and CBN Rates); Friday, January 15, 2021

The Nigerian Naira remained under pressure against the United States Dollar on the parallel market at N475 exchange rate, while the value has not improved against the Euro and Pound, inflation rose to 15.75 percent in the month of December to further compound Nigeria’s predicament.

Date USD GBP EURO YUAN Canadian Australian
NGN BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL
15/01/2021 470/475 635/642 573/580 60/70 375/385 245/293
14/01/2021 470/475 630/640 570/580 60/70 375/385 245/293
13/01/2021 470/474 630/637 570/580 60/70 375/385 245/293
12/01/2021 470/475 630/637 575/580 60/70 375/385 245/293
11/01/2021 468/675 625/635 575/582 60/70 372/382 245/293
08/01/2021 467/672 622/630 570/575 60/70 365/378 245/293
07/01/2021 465/470 620/628 570/575 60/70 365/378 245/293
06/01/2021 465/470 620/628 565/570 60/70 365/378 245/293
05/01/2021 465/470 620/628 565/572 60/70 365/378 245/293
04/01/2021 465/470 620/628 565/572 60/70 365/378 245/293
31/12/2020 465/470 620/628 567/573 60/70 365/378 245/293
30/12/2020 465/470 620/628 567/573 60/70 365/378 245/293
29/12/2020 465/470 620/628 565/573 60/70 365/378 245/293
28/12/2020 460/465 615/625 560/570 60/70 350/367 245/293
25/12/2020 460/465 615/625 560/570 60/70 350/367 245/293
24/12/2020 460/465 615/625 560/570 60/70 350/367 245/293
23/12/2020 470/475 622/632 575/580 60/70 350/367 245/293
22/12/2020 472/476 622/630 570/578 60/70 340/362 250/295
21/12/2020 472/476 622/632 570/580 55/68 340/362 250/295
18/12/2020 472/477 622/630 570/577 55/68 340/362 250/295

 Bureau De Change Naira Rates

Date USD GBP EURO
NGN BUY/SELL BUY/SELL BUY/SELL
15/01/2020 460/475 630/638 570/577
14/01/2020 460/475 630/638 570/577
13/01/2020 460/470 626/633 565/576
12/01/2020 460/470 626/633 566/576
11/01/2020 460/470 620/630 560/573
08/01/2020 460/470 615/625 555/573
07/01/2020 460/470 615/623 550/570
06/01/2020 460/470 610/623 550/572
05/01/2020 460/470 615/624 550/572
04/01/2020 460/470 615/624 550/572
31/12/2020 460/470 600/626 550/573
30/12/2020 460/470 600/626 550/573
29/12/2020 455/475 600/626 550/573
28/12/2020 455/475 605/628 555/573
25/12/2020 455/475 600/628 550/575
24/12/2020 455/474 600/628 555/575
23/12/2020 460/475 621/632 568/580
22/12/2020 470/475 620/631 568/577
21/12/2020 470/475 620/631 568/577

Central Bank of Nigeria’s Official Naira Rates

Date Currency Buying(NGN) Central(NGN) Selling(NGN)
1/15/2021 US DOLLAR 379 379.5 380
1/15/2021 POUNDS STERLING 516.9181 517.6001 518.282
1/15/2021 EURO 459.4996 460.1058 460.712
1/15/2021 SWISS FRANC 426.8499 427.413 427.9761
1/15/2021 YEN 3.6548 3.6596 3.6644
1/15/2021 CFA 0.6839 0.6939 0.7039
1/15/2021 WAUA 545.8708 546.5909 547.3111
1/15/2021 YUAN/RENMINBI 58.531 58.6087 58.6864
1/15/2021 RIYAL 101.0236 101.1568 101.2901
1/15/2021 SOUTH AFRICAN RAND 24.8724 24.9052 24.938

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Naira

Naira Drops to N394.67 Against US Dollar on I&E FX Window

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Naira Dollar Exchange Rate

Naira Drops to N394.67 Against US Dollar on I&E FX Window

Economic uncertainties amid the rising number of COVID-19 continues to weigh on the Nigerian Naira across key foreign exchange markets.

The Nigerian Naira depreciated against the United States Dollar on the Investors and Exporters (I&E) Foreign Exchange Window on Thursday.

The local currency depreciated by 0.34 percent to N394.67 per US Dollar, down from N392.69 it opened the day.

On Thursday, investors exchanged $215.63 million on the I&E window.

Despite efforts to ease forex scarcity with $20 billion diaspora remittance, the Naira continued to fall against global counterparts due to weak remittance inflows from developed nations.

Like other nationalities, Nigerians in the diaspora are struggling with lockdowns, surged in the unemployment rate and the drop in global earnings.

Also, weak foreign reserves amid rising debt servicing and other expenditures are hurting the central bank’s ability to intervene effectively across the foreign exchange markets as usual.

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Forex

Stanbic IBTC Shut Down Bureau De Change Business

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stanbic IBTC Insurance

Stanbic IBTC Shut Down Bureau De Change Business

Stanbic IBTC Holdings Plc has shut down its bureau de change subsidiary, Stanbic IBTC Bureau De Change Limited (Stanbic IBTC BDC) due to the change in foreign exchange inflow policy.

It should be recalled that the Central Bank of Nigeria (CBN) adjusted the policy of diaspora remittance inflow to stimulate growth and ease forex scarcity across the nation.

Therefore, Stanbic IBTC said the decision to discontinue its bureau de change operations was because of the recent changes in diaspora inflow that now affords customers the opportunity of purchasing foreign exchange (PTA and BTA) directly from Stanbic IBTC Bank at any of its branches nationwide.

In a statement signed by Chidi Okezie, Company Secretary, Stanbic IBTC, said the bureau de change business was discontinued effective from 01 January 2021 through relinquishing of its operating license.

The intention is to repurpose this subsidiary for other business ventures in the near future, and stakeholders would be duly notified when all engagements have been concluded in this regard,” it stated.

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