Dollar, Pound, Euro, Naira Exchange Rates Mixed

Economic uncertainty continues to dictate Naira exchange rates against key global counterparts. The Naira exchange rates were mixed on Monday 7 February 2022 as the local currency dipped against the United States Dollar to N416.88, down from N416.71.

This decline continues against the Euro common currency, the Naira traded at N478.4115 to a Euro, representing a decline of 1.71 percent from N470.3822 it exchanged on Thursday.

However, against the British Pounds, the Naira gained to N565.9563, better than N567.2673 it exchanged on Thursday, the Central Bank of Nigeria’s data showed.

External Reserves

Nigeria’s external reserves remained in range in the last week, moving between $39.983 billion and $40 billion. Despite crude oil hitting $93 per barrel, Nigeria’s failure to meet its OPEC+ quota of 1.71 million barrels per day continues to drag on the nation’s revenue generation.

In January 2022, Nigeria produces 1.43 million barrels per day, far below its 1.71 million barrels per day quota and its 2.1 million barrels per day capacity.

Crude Oil

Oil prices moderated on Monday amid reports that the US and Iran are progressing to the final stage of talks on the nuclear deal.

Brent crude oil, against which Nigerian oil is priced, pulled back from its record high of $94 a barrel to $92.66. The US West Texas Intermediate depreciated to $91.27 a barrel.

Oil traders have started pricing in the possibility of Iran hitting the global oil market with about 4 million barrels of crude oil per day immediately the two nations reached a comprise.

Craig Erlam, Senior Market Analyst, UK & EMEA, OANDA said “Biden has an additional incentive to reach a deal, given the sky-high crude prices and what a deal could do to ease the tightness in the market just before the midterms. He’s tried a coordinated SPR release and let’s be honest, it achieved very little. This could make a real difference at a time when crude appears destined for $100 and OPEC+ can’t hit their output targets.”

Cryptocurrency

On Monday most cryptocurrencies opened in the green with the Shiba Inu coin appreciating by 50 percent before paring gains to 42 percent during the London trading session.

Bitcoin gained 6.17 percent to $44,296 a coin while Ethereum, XRP, Solana and Terra (Luna) appreciated by 5.74 percent, 17.40 percent, 6.38 percent and 6.80 percent, respectively.