Naira Climbs Against Dollar as Foreign Reserves Crossed $39bn
The naira appreciated slightly against the US dollar at the Nigeria Foreign Exchange Market (NFEM) in the absence of demand pressures and rising confidence in the currency market.
The Central Bank of Nigeria (CBN) FX update on Tuesday showed that the official exchange rate appreciated to N1533.18 per greenback, from N1534.20 the previous day.
The exchange rate touched an intraday high of N1535.50, and some FX transactions touched intraday low of N1520 but closed at N1532.50, according to data from the CBN.
Some investment banking firms maintained that the local currency will face no significant pressures with the CBN direct interventions stance, which is expected to be further supported by growing external reserves.
The CBN update revealed that gross balance in the nation’s external reserves surpassed $39 billion, first time since February 2025 when it started dropping. The CBN’s $4.7 billion FX interventions reported in the first half of the year plunged the external reserves to $37 billion before the latest inflows reversed the trend.
Scanty data about external reserve movement, however, does not permit the market to identify sources of inflows which has persistent in July.
In the parallel market, the naira exchange rate settled at N1532 per dollar, according to channel check conducted by MarketForces Africa. The exchange rate gap between official and parallel market has eliminated speculative activities in the Nigerian FX market.
In the global commodity market, uncertainties remain ahead of Fed rate decision. Oil prices surged after a trade deal between the U.S. and the EU, and President Donald Trump’s announcement that he would shorten the deadline for Russia to end its war in Ukraine or face sanctions.
Brent crude futures traded above $70.41 a barrel, while U.S. West Texas Intermediate (WTI) crude rose $1.89 to $67.05. Meanwhile, gold prices slipped after the U.S.-EU trade accord lifted the dollar and risk sentiment, while investors awaited fresh cues on rate policy from this week’s Federal Reserve meeting. #Naira Climbs Against Dollar as Foreign Reserves Crossed $39bn CBN Intervenes in FX Market as Dollar Inflow Falls by 25%
