Naira Rises as Foreign Reserves Hit $39.994bn after 21 Inflows
The naira appreciated against the US dollar at the Nigerian Foreign Exchange (NFEM) in the absence of significant funding pressures in the official trading platform.
FX data update from the Central Bank of Nigeria (CBN) showed spot rate appreciated to N1533.73 per dollar at the official window, a moderate on the day gain of about N1 from N1534.43.
At the official window, exchange rate hit intraday high of N1535.99 before it closed at N1535, versus intraday low of N1531.99 per dollar. The Nigerian local currency has been trading range bound, reflecting market confidence and sustained FX liquidity supported by the CBN intervention.
The official rate has not exit the tight range in spite of forex market intervention, supported by inflows from exporters and foreign portfolio investors. Some international oil companies US dollar inflows also boosted liquidity in the currency market.
In the parallel market, the naira lost value against the dollar, settling at N1560 as demand for FX for unofficial use increased sharply. Bureau de Change (BDCs) operators has seen low supply from local banks. Sources said peer to peer trading has been filling the gap, but a rate beyond the CBN target band.
The development has widened exchange rates gap between official and parallel market selling rates. Elsewhere, CBN FX data update showed the external reserves continue to increase, reaching $39.994 billion this week following 21 inflows from an undisclosed sources.
Elsewhere, oil prices dipped in the global commodity market, wiping out early gains, after the announcement of a meeting between President Vladimir Putin and President Donald Trump in the coming days, raising expectations for a diplomatic end to the war in Ukraine.
Brent crude shed 48 cents to $66.41 per barrel, while U.S. West Texas Intermediate depreciates by 54 cents to $63.81. However, gold rose to an over 2-week high, buoyed by safe-haven demand after U.S. President Donald Trump’s tariffs went into effect and U.S. jobs data added to rate-cut expectations.
Spot gold gained by 0.60% to $3,389.40 per ounce, while U.S. gold futures closed $16.03 higher at $3,452.25.Commodity prices are expected to trade cautiously tomorrow as investors await the possible announcement of new tariffs on China, as hinted by President Trump.
#Naira Rises as Foreign Reserves Hit $39.994bn after 21 Inflows# Stock Market Accounts for 25% of Nigeria’s GDP
