• USD/NGN to appreciate to 187 by end-20104: standard Chartered

    Source: FxWire Pro - Commentary / 02 Dec 2014 01:30:00   America/New_York

    Quotes from Standard Chartered:

    -We revise our USD-NGN forecast for Q4-2014 to 187 from 166 previously, and those for Q1-, Q2-, Q3- and Q4-2015 to 190 (from 172), 187 (from 170), 186 (from 168)and 185 (from 169), respectively. We maintain our Underweight FX weighting in the short and medium term (note that NDF outrights have displayed extreme volatility lately).

    -The Central Bank of Nigeria (CBN) moved its official exchange rate mid-point to 168 from 155 on 25 November and widened the FX band to +/-5%, from +/-3%. Interbank USD-NGN was already trading around 184 on 1 December, from 161-163 in Q3-2014.

    -We see further upside risks in coming months given weak oil price momentum, declining FX reserves, domestic capital flight and the CBN's reluctance to allow a more significant repricing of the yield curve.

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