Exchange rate stable, but at the cost of falling reserves   

06 November 2018 : Unlike other emerging market currencies which have depreciated materially against the dollar in 2018, the naira has weakened by less than 1% at the I&E FX Window thanks to stable intervention from the Central Bank of Nigeria (CBN). However, this exchange rate stability has come at the cost of falling reserves—from $47 billion in April to $42 billion in October. Moreover, bond yields have inched up in recent months. The 10-year bond was sold at 14.3% at the July bond auction and 15.3% at the October bond auction. This is in line with the wider emerging market trend as investors have demanded higher yields amid rising U.S. interest rates. Whilst analysts foresee continued pressure on the naira ahead of the 2019 elections, analysts expect the rate of depreciation to remain below other emerging markets as the CBN continues to intervene in the foreign exchange market. 


Stock Watch: UNITYBNK released all outstanding results dating up to 9M’18 result on Friday, reporting a 60% decline in topline to N26.1 billion and a 76% fall in PAT to N585.8 million in the most recent period. The company’s stock fell 897bps in Friday’s session to settle at N0.71, posting a 34% YTD gain. The NSE had earlier placed a trading suspension on the stock yesterday but this was lifted on Friday. 


Reporting for EasyKobo on Tuesday , 06 November 2018 in Lagos, Nigeria


Source: Vetiva Capital Management Limited



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