Market News

by Collins Nweze | Assistant Business Editor

The naira strengthened by N5.75 against the dollar, closing weekend at N1,358.25 per dollar at the Nigerian Foreign Exchange Market (NFEM). 

Data released by the Central Bank of Nigeria (CBN) also showed that Nigeria’s external reserves rose from $52.06 billion to close weekend at $52.26 billion. The reserves position can cover 10-month import for the economy.

The increase provides additional support to the country’s foreign exchange position. The local currency continues to trade within a relatively narrow range at the official market.

The currency had closed the previous week at N1,364 per dollar, an appreciation of 0.42 per cent.

The recovery came after the naira initially weakened during the week, reaching N1,365 per dollar  on Tuesday before strengthening over the final three trading sessions.

The movement occurred amid fluctuations in foreign exchange market activity and a rise in Nigeria’s external reserves. 

CBN trading data showed that the naira ended the week stronger despite midweek weakness, while foreign exchange turnover remained volatile during the period.

CBN data showed that 137 interbank deals were recorded on Friday, with interbank turnover of $119.59 million. The naira’s recovery came amid fluctuations in foreign exchange market activity during the week, with turnover falling sharply before recovering in subsequent sessions.

Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso said the apex bank’s policies over the last three years have significantly improved the foreign exchange market in Nigeria, moving from one with opacity to a transparent market with its unified exchange rate. 

“This has eliminated the need for Nigerians to scramble for foreign exchange and has made it easier for businesses to access foreign currency. The reforms have also improved the international perception of Nigeria’s currency, as naira cards now work abroad,” he stated.

He said that the reforms and rising confidence in the economy pushed diaspora remittances to $600 million plus monthly, adding that the remittances will hit $1 billion monthly by year end.

“We are expecting that by the end of the year, the diaspora remittances will hit about $1 billion a month from diaspora businesses,” he said.

He said the robust liquidity in the forex market has motivated foreign investors to take investment decisions that favour the country because of the free entry and exit policy.