Nigerian Naira Hovers at N1,362 as CBN Drives 50% of FX Liquidity
The Nigerian naira hovered around N1362 per dollar at the official foreign exchange market on Monday after the Central Bank stepped in to defend the local currency last week.
The local unit declined slightly against the US dollar to N1362.2064 from the opening rate of N1362.0866 previously quoted at the official window at the beginning of the week.
FX data released by the Apex Bank showed that foreign payments were conducted between N1,359 and N1,365.5000 per US dollar bid for eligible transactions.
Nigerian Foreign Exchange Market (NFEM) saw a sharp decline in interbank FX turnover, and deals among financial institutions reduced strongly.
Interbank FX turnover closed at $39.587 million on Monday, down by approximately 56% from $89.082 million at the close of the trading session on Friday.
The Naira strengthened at the NAFEM window, appreciating by 1.31% over the five days to close at N1,362.09/US$1 on Friday compared to N1,380.18/US$1 the previous week.
Broadstreet analysts said the spot rate movement reflects relative stability in the official market, supported by CBN FX interventions and steady foreign exchange inflows.
Nigeria’s external buffers showed a slight improvement, with gross reserves rising 0.17% to US$52.03 billion from US$51.94 billion within 5 days.
While the increase is modest, it reinforces the CBN’s capacity to sustain its market interventions in the near term, Coronation Merchant Bank Limited said in a note.
The Merchant lender said in a research note that total foreign exchange inflows for the week amounted to US$1.01 billion, with the CBN contributing the highest inflows of US$0.50 billion or 49.36%.
The Apex Bank contribution was followed by the Foreign Portfolio Investors inflows totalling US$0.26 billion (26.03%), Exporters contributed US$0.14 billion (13.85%), and Non-bank Corporates contributed US$0.09bn (9.02%).
Other Corporates contributed US$0.01 billion (1.16%), Individuals contributed US$0.00 billion (0.37%), and Foreign Direct Investors contributed 0.19% of the total US dollar volume.
The market anticipates the naira to trade within a narrow range, supported by sustained foreign exchange inflows and the CBN’s continued market interventions, helping to cushion pressure from sustained FX demand. Risk-off: High U.S. Treasury Yields Make Nigerian Eurobonds Unattractive
