Naira Extends Rally as CBN Bridges FX Liquidity Gap
Staying strong against the dominant US dollar, the naira appreciated in the official foreign currency market as the Central Bank of Nigeria (CBN) continue to close the gap between demand and supply.
According to data obtained from the CBN platform, the naira rose against the US dollar by 29 basis points to close at N1581 on Monday after $120 million FX injection last week.
The USD/NGN pair fluctuated between $/₦1,579.00 and $/₦1,584.00, resulting in a 29-bps gain for the Naira, which settled at $/₦1,581.5866 by the close of the session. “Barring any major disruptions, the Naira’s exchange rate should remain range-bound in the near term”, AIICO Capital Limited said.
To keep liquidity strong, the CBN has continued to play strong in the currency market, selling dollars to banks at below the market rate with the aim to meet eligible FX demand.
Even with its efforts, fx inflows into the official window eased sharply last week, down by 76% to $1.04 billion week on week, according to Coronation Research report. The market anticipates continuous FX intervention will keep exchange rate stable amidst uncertainties in the global commodity market.
Yesterday, oil prices surged nearly 3% despite OPEC+ maintaining its planned output increases, as wildfires in Canada’s oil region raised supply concerns and President Trump’s new tariff threats pressured the U.S. dollar.
Brent crude rose by $1.85, or 2.95%, to settle at $64.63 per barrel, while U.S. West Texas Intermediate (WTI) crude increased $1.73, or 2.85%, to $62.52. Gold prices jumped over 2%, reaching a three-week high, driven by a weaker dollar, geopolitical tensions, and economic uncertainty. Tunisia’s Central Bank Keeps Key Interest Rate at 7.5%
