The Organised Private Sector said on Tuesday that the new Naira-Settled OTC FX Futures Market inaugurated by the FMDQ OTC Securities Exchange and the Central Bank of Nigeria would reduce panic purchase of foreign exchange.
Muda Yusuf, the Director-General of the Lagos Chamber of Commerce and Industry, told the News Agency of Nigeria that the FX Futures Market had doused the tension in the FX sector.
NAN recalls that the FMDQ OTC Securities Exchange, in partnership with the CBN, on June 27 inaugurated the first Naira-Settled OTC FX Futures Market.
The aim of the naira-settled OTC FX Futures Market is to minimise the disequilibrium in the Spot FX market.
It is also to attract capital inflows to the country’s fixed income and equity markets and achieve naira exchange rate stability.
Yusuf said the pressure in the spot market had been drastically moderated by the inauguration.
He said: “The overriding benefits of it is that it allows for better planning, reduces uncertainty and will boost investors’ confidence in the economy.
“With the Naira-Settled OTC FX Futures Market, one can now plan for an upward of four months, as far as the foreign exchange component of the investment plan is concerned.
“The OTC FX Futures Market will definitely increase the level of production in the real sector.
“It is good for the economy because it will shield investors from possible volatility in the foreign exchange market, which had previously affected businesses.”
Also speaking, Frank Jacob, the President of the Manufacturers Association of Nigeria, said the Naira-settled market would make foreign exchange available for manufacturers.
Jacob said: “I believe it is good for businesses because the availability of foreign exchange for manufacturers to get certain raw materials will aid production.
“It will also reduce production costs as they can plan the purchase of FX at a price that suits them.”
NAN reports that OTC FX Futures rates of N/$ July (1-month) stood at N279/$1; August (2-months) rate at N277/$1; N/$ September rate is N275/$1; and October is N267/$1.
The November rate is N260/ $1, while December is N250/$1.
NAN.
Trending
- Fidelity Bank share price appreciates by 297% in 13 years
- Missing university female student found dead
- As petrol sells for N800, groans heard in Lagos
- Manipulation, gaslighting and lies, by Richard Odusanya
- PDP suspends Rivers House of Reps member
- NUPRC opens bid for 17 marginal oil fields – Komolafe
- Naira slides by 6% against dollar at official market
- 34 killed in less than one month in Awka — Lawmaker