Naira Declines Against Pounds Sterling, Euro But Unchanged Against U.S Dollar

The Nigerian Naira was unchanged against the United States Dollar at the Central Bank of Nigeria’s regulated exchange portal.

The Naira to Dollar exchange rate stood at N416.34, the same rate it exchanged on Friday and Monday. Against the Pounds Sterling, the Nigerian Naira dipped slightly from N548.5696 on Friday to N546.4879 on Monday.

Similarly, against the Euro common currency, the Naira traded at N454.0188, down from N452.6865. These are the rates the Central Bank of Nigeria (CBN) sells to Deposit Money Banks, the only approved institutions to buy and sell foreign currencies.

At the unregulated black market, the Naira remained pressured, trading at N570 to a United States Dollar in Ibadan.

Foreign Reserves

Nigeria’s foreign reserves declined by $70 million from $39.870 billion on Friday to $39.800 billion, according to the latest data from the Central Bank of Nigeria.

Despite the rise in crude oil to $133 per barrel, the foreign reserves continue to decline, largely due to the rising cost of landing finish petroleum products and the amount needed by the Federal Government of Nigeria to subsidize the products for its over 200 million population.

Africa’s largest economy and the biggest exporter of crude oil on the continent may not be able to take advantage of the current increase in crude oil prices as it still depends on imports for finished petroleum products.

Crude Oil

Brent crude oil, the international benchmark, rose to $133 per barrel on Tuesday after the U.S and U.K imposed sanctions on Russian oil imports.

President Biden had announced the United States will halt imports of Russian fossil fuels including oil. The United Kingdom on the other hand said it would ban Russian oil imports but will continue to allow natural gas and coal from Moscow.

The ban bolstered oil prices as experts believed the decision would worsen global supply, especially given the market is already struggling with supplies. OPEC and allies, together known as OPEC plus, can’t even meet their own targets. While the ongoing talks between Tehran and Washington might have slowed down after Russia demanded a written assurance that the revival of the U.S-Iran nuclear deal will not affect Moscow-Tehran trade relations.

Experts now believed Iranian crude oil may not hit the global market anytime soon, hence why they have started predicting $200 a barrel as early as March ending.

Cryptocurrency

The cryptocurrency market came alive on Tuesday evening after President Biden was said to be planning to sign an executive order outlining the U.S government’s plan for cryptocurrency space.

People familiar with the situation said the president will direct Justice Department, Treasury and other agencies to study the legal and economic ramifications of creating a U.S. central bank digital currency. This, the crypto community interpreted as positive for the crypto space.

Bitcoin gained 8.18% to $42,132 per coin. The Ethereum token (ETH) also appreciated by 6.33% to $2,754. Terra (Luna) gained the most in the last 24 hours, appreciating by 20.25% to $98.13 a coin.