Naira Gains as Nigeria’s Foreign Reserves Climb to $42.669bn
The naira gained as Nigeria’s foreign reserves climbed to $42.669 billion on Wednesday, the highest gross balance seen since September 2019, from $42.589 billion at the beginning of the week.
The local currency had seen successive depreciation on the back of increased demand for US dollar at the official window. The market continued to experience a sharp decline in FX injections.
In September, total FX sales to the authorised dealer banks at the official FX market was $150 million, helping to balance the US dollar demand and supply equation. But analysts see a further cutback in Oct.
Updated FX data released by the Central Bank of Nigeria (CBN) showed that the local currency rebounded after sell pressure, appreciating 0.15% to ₦1,471.03 at the official window.
The exchange rate direction indicated there was improved US dollar volume available at the supply side in the forex market. The official spot rate reached an intraday high of N1475 and eventually closed at N1474 per dollar. Likewise, the naira rose 0.17% in the parallel market to close at ₦1,486.
Trading activities at the forex market was executed within a range of ₦1,464.42 to ₦1,475.00 during the session. The nation’s foreign reserves expanded by about $18 million amidst oil price fluctuations.
On Thursday, global oil prices held lower as traders prepared for a potential halt to India’s Russian oil imports, which could reshape flows and boost demand for supplies from elsewhere.
Brent crude dipped $1.02, or 1.65%, to $60.89 per barrel, while U.S. West Texas Intermediate (WTI) receded by 54 cents, or 0.93%, to $57.30.
Conversely, gold hit a record high for the fourth straight session, as investors flocked to the safe-haven metal on brewing U.S.-China trade tensions and the U.S. government shutdown, with bets on interest rate cuts fuelling the momentum.
Spot gold climbed 1.484% to $4,285.56/oz, while U.S. gold futures advanced 1.84% to $4,300.99/oz.
Commodities prices are expected to rise, driven by gold’s safe-haven demand amid geopolitical tensions and rate cut bets and oil’s upward momentum following reports that India will halt Russian crude purchases. Dangote Cement Hits 52-Week High, Surpasses N10 Trillion
