Naira Appreciates to N1,480 on Sufficient Dollar Liquidity
The Nigerian naira official exchange rate appreciated to N1480 per dollar at the end of the trading session on Friday in the absence of significant pressure in the forex market.
The local currency strengthened against the US dollar on the back of sufficient FX liquidity amidst sustained FX intervention by the Apex Bank and rising external reserves.
Updated FX from the Central Bank showed that the naira hit an intraday low of N1471, reflecting a positive exchange rate outlook. Foreign inflows boosted liquidity, and corporate FX demand was sufficiently met at the official window.
The official exchange rate direction in the last few weeks paints a picture that the local currency will close the year stronger, backed by foreign investors’ increased FX confidence.
MarketForces Africa gathered that Nigerians have started to liquidate some structured dollar investors over fear that the naira will continue to gain value versus the dollar in 2025.
With $42.225 billion in external reserves, analysts told MarketForces Africa that the CBN has a stronger buffer to keep the naira rally on track for the year.
“Even if Nigeria settles the Eurobond repayment due in November, the country’s net foreign exchange balance will be more than enough to maintain
FX intervention in the currency market,” an investment banking expert who was not authorised to speak said in a chat. Forex market analysts at Cordros Securities Limited maintain a positive outlook on the naira, supported by expectations of sustained FX liquidity.
“On the domestic front, rising non-oil exports and improving market confidence should underpin inflows, while externally, healthy FX reserves, a positive current account position, and a shift toward global monetary easing are expected to reinforce foreign investor sentiment and stimulate additional FX market inflows”, the firm said. Femi Otedola Stake in First Holdco Rises with N1.21bn Shares Purchase
