CBN Sells Additional Dollars to Stop Naira Losses
The Central Bank of Nigeria (CBN) has made another foreign exchange market intervention this week to address the ongoing depreciation of the naira.
In response to a significant demand for US dollars, the CBN sold a total of $200 million in two consecutive trading sessions to eligible forex market participants.
Despite recent improvements in external reserves, which are nearly $50 billion, the naira continues to struggle against the US dollar.
On Tuesday, the CBN initially sold $100 million, followed by an additional $100 million on Wednesday to alleviate the pressure on demand, as reported by TrustBanc Financial Group Limited.
At the official window, the naira fell by ₦3.70 in the official market, closing at ₦1,359.82 per dollar, the CBN published daily FX data revealed on Thursday.
The investment firm reported that the parallel market saw a slight improvement, appreciating by ₦5.00 to ₦1,395.00 per dollar.
As a result, the gap between the official and parallel market rates narrowed, the firm said, with the FX spread falling to 2.59% from 3.24%. #UBA Climbs to N2.1trn as Investors Bet on Earnings Outlook
Nigeria’s external reserves are near $50 billion, as FX receipts from hydrocarbon sales increase due to improved oil output.
Oil prices rose by almost $1 on Thursday as investors awaited the outcome of a third round of talks between the United States and Iran over the latter’s nuclear program.
Brent crude gained 48bps or 34 cents, hovering around $71.17 per barrel, while U.S. West Texas Intermediate (WTI) gained 32bps, to around $65.63 per barrel.
Conversely, Gold traded mixed on Thursday as investors weighed concerns that tariffs could stoke inflation, while ongoing tensions between Iran and the United States kept bids for safety intact.
