Naira Exchange Rate Climbs to N1,348 in Official Market
The Nigerian naira exchange rate per dollar climbed to N1,348 at the official market amidst rising external reserves, and inflows from offshore investors with interest in elevated yields in the fixed income market.,
With Nigeria’s successful reforms, the market anticipates a healthy improvement in exchange rates as some investment bank sources begin to suggest a pause in dollar-structured investment.
According to data obtained from the Central Bank, the Naira strengthened against the US dollar, appreciating by ₦2.07/US$ to close at ₦1,348.95/US$ compared with ₦1,351.02/ US$ previously recorded.
Based on data from the CBN, Fx largely traded within the low and high bands of ₦1,345.00/US$ and ₦1,351.00/US$, respectively. Anchoria Securities Limited expects the Naira to continue trading in line with prevailing market demand and supply dynamics, supported by an improving external reserves position.
Nigeria’s foreign reserves recorded fresh inflows that pushed the gross balance to $47.37 billion, updated data from the CBN revealed.
The nation’s gross external reserves continue to maintain an upward trend since the start of the year, strengthening the ability of the authority to defend the local currency even more amidst fluctuation in oil prices.
Global oil prices gained about 1% on Wednesday, as investors worried about escalating tensions between Iran and the U.S., which were preparing to resume negotiations, while a weekly report showing a large build in U.S. crude inventories limited gains.
Brent crude rose 126bps or 87cents, hovering around $69.67 per barrel, while U.S. West Texas Intermediate (WTI) spiked 150bps, to around $64.92 per barrel.
Similarly, gold prices rose more than 1% on Wednesday as the market consolidated after strong U.S job and unemployment data to offer further clues to the Federal Reserve’s interest-rate outlook. Spot gold price rose 140bps to $5,093.74/oz, while U.S. gold futures shed 35bps, hovering around $5,117.61/oz.
Analysts expect the market to remain cautious to bullish after strong U.S. economic data and ongoing geopolitical risks amid mixed price action in oil and metals. Banks Placements with CBN Surge as Loan Appetite Tightens
