Naira Rises Against US Dollar as FX Shortage Eased
The naira exchange rate improved in the foreign exchange (FX) market midweek due to improved US dollar liquidity. According to spot data from the FMDQ platform, the naira appreciated by 2.63%, closing at N1,645.40 per US dollar at the official market.
The total daily turnover increased to 236.84 million dollars on Wednesday up from 106.44 million dollars recorded on Tuesday. At the Investor’s and Exporter’s (I&E) window, the Naira traded between N1,698.50 and N1,609.00 against the dollar amidst FX intervention cutback.
The nation’s gross external reserves continue to rise, settling at $40.207 billion following successive US dollar inflows. Analysts said this is the highest level the foreign reserve has attained in the last 35 months.
The sources of inflows remain unknown but some analysts believe that increasing OMO bills sales and remittance could be drivers of the latest accretion. Nigerian government recently call for disbursement of $750 million World Bank loan as part of broader $2.25 billion borrowed from the multilateral lender.
In a conference, the finance minister Wale Edun said foreign investors improved confidence on Nigerian economy has continued to attract FX inflows into the economy.
Edun said the government now target $1 billion FX inflows on monthly basis from foreign sources as Nigeria becomes investments destination due to reforms. In the parallel market, the Naira closed at ₦1,734 to the US dollar, lost N9 on the day as pressures began to build over amid year end imports.
Elsewhere, oil prices remained close to their lowest levels in two weeks following OPEC’s revision of its outlook for global oil demand growth in 2024 and 2025, coupled with ongoing concerns over demand in China.
Consequently, Brent crude stabilized at $72.24 per barrel, while WTI was around $68.47. Similarly, gold prices rose after falling to their lowest point in almost two months the day before, with gold now trading at approximately $2,596.80 per ounce. FX Stability: CBN Sells 122.671m Dollars to 46 Authorised Dealers
