Naira on Tuesday depreciated in value against the dollar by N1.39k or 0.70 percent at the inter-bank foreign exchange market, as a result of increased demand for the greenback by end users.

After trading on Tuesday, the local currency closed at N199.11k/$ as against N197.72k/$ traded the previous day, according to data from FMDQ.

However, naira gained against the dollar at the parallel market and Bureau de Change (BDC) segments of the foreign exchange by N1 or 0.47 percent each.

It closed at N208/$ compared with N210/$ the previous day at the BDC segment and N210/$ on Tuesday from N211/$ the previous day at the parallel market.

On the other hand, money market rates hit a 6-month high, after the Open Buy-Back OBB and Overnight (OVN) rates, respectively, appreciated by 48.33 percent and 50.83 percent, fixing the average Month-on-Month rate at 85.83 percent ( 49.58%).

“Though our liquidity gauge reflects a 2-day lag, we attribute the spike in rates to the liquidity crunch in the financial system, buoyed by the enforcement of the Treasury Single Account (TSA).

“Similarly, Nigeria Inter-Bank Offered (NIBOR) trended north across all tenors, with the 6 Month tenor recording the highest rise of 2.46 percent to settle at 22.13 percent,” analysts at Meristem said in a report.

Activities across the shorter-term instruments waned, as yields across all tenors trended north save for the yield on the 12M T-bills that pared marginally by 0.35 percent. At the close of the today’s trading session, average yield across T-bills settled at 15.45 percent, implying a 0.27 percent rise compared with 15.18 percent in the prior trading day.