Nigerian Naira Gains Value, Rises by N18 Against U.S. Dollar
The naira gained value, rising by about N18.10 per US dollar in the official foreign exchange market as improved FX supply drove the rate lower last week, data tracked from the Central Bank confirmed.
The local currency posted gains throughout the last five trading sessions on ample FX liquidity, aided by foreign portfolio investors, exporters and non-bank corporate inflows.
Traders reported that as the session progressed, ample supply was effectively matched by demand, keeping rates relatively stable for the remainder of the day.
Consequently, benchmark rates appreciated across the board, with the Nigerian foreign exchange market (NFEM) rate strengthening by ₦1.88 to close at ₦1,367.57 on Friday.
The local unit appreciated by 1.33% week-on-week while it strengthened by 0.73% in the parallel market, closing at N1,369.12/US$, Cowry Asset Management Limited said in an update.
Nigeria’s external reserves increased marginally by 0.19% week-on-week to US$52.04 billion, reflecting a modest improvement in the country’s external liquidity position.
In the commodities market, crude oil prices recorded strong gains during the week, supported by heightened geopolitical tensions and concerns over potential supply disruptions.
Market sentiment was influenced by disruptions around the Strait of Hormuz, continued attacks on vessels in the Bab el Mandeb Strait, and the temporary suspension of oil flows through the Caspian Pipeline Consortium (CPC) system following drone attacks.
Brent crude traded at $100.39 per barrel, while US West Texas Intermediate (WTI) crude stood at $97.82 per barrel, reflecting elevated risk premiums in global energy markets.
Meanwhile, Bonny Light crude remained supported by the broader upward trend in international oil prices, with expectations that supply concerns may continue to influence price movements in the near term.
Analysts expect the naira to remain relatively stable in the near term, supported by improved FX liquidity, higher external reserves, and stronger crude oil receipts.
The market anticipates that local currency movements will continue to be influenced by FX demand pressures and global market developments. #Nigerian Naira Gains Value, Rises by N18 Against U.S. Dollar South African Rand Weakens as Reserve Bank Holds Rates
