CBN weakens Naira on futures market

CBN

The Central Bank of Nigeria has weakened the naira on the futures market across multiple maturity periods, according to data reported by Reuters on Wednesday,

The futures market is where currencies are traded on locked-in rates, through contracts to be fulfilled on later dates.

According to data reported by Reuters, the CBN weakened the five-year naira futures contract, the longest maturity for the currency, to record low of 630.30 naira to a dollar. The contract with three-weeks to maturity eased 7.01 naira to 412.14 naira.

The CBN’s decision came as the local currency fell to a record intra-day low of 416.95 per dollar on the over-the-counter spot market, where currencies trade daily. On the black market, naira traded at 480 naira. The CBN’s official rate set in July 2020 is 381.

The naira has faced pressures from investors trying to repatriate money home after the Debt Management Office last week repaid a $500 eurobond.

The central bank last month vowed to sanction exporters who fail to repatriate their dollars.