Increased currency pressure as a result of softening oil prices and weak investor sentiment weakened the naira in all segments in the month of October.
The naira depreciated by 0.01 per cent at official market, 3.85 per cent at inter-bank market and 1.18 per cent in the parallel market.
The spread between inter-bank and parallel markets narrowed to N1 from N5.3 in September. The narrowing is however good news as it will discourage speculators from doing business with profits narrowing also.
Bismarck Rewane, chief executive officer of Financial Derivatives company is sure that the Central Bank of Nigeria (CBN)’s restriction of dollar sales to BDCs will reduce supply and weaken the naira, and that with pressure on the interbank market exchange, rate is expected to ease.
Meanwhile, money supply increased by 2.73 per cent month-on-month (m-o-m) to N16.57 trillion in September.
Net domestic assets rose by 5.66 per cent to N8.96 trillion, while credit to Private Sector (CPS) went up by 1.55 per cent to N17.66 trillion.
Inflation rate slowed to 8.3 per cent in September, implying growth in M2 had no impact on consumer prices.