The naira made notable gains against the US dollar in the official exchange market, driven by a rise in foreign currency supply from the Central Bank of Nigeria (CBN) and foreign investors.
The naira increased by 72 basis points, finishing at ₦1,522.68 per US dollar, according to data from the forex market. This improvement followed new foreign investor investments and additional foreign currency injections by the CBN into the market.
In the parallel market, the naira also improved, gaining ₦20 to settle at ₦1,620 per dollar. This followed a decision to waive annual licence renewal fees for Bureau de Change operators, boosting their operations.
Financial firm AIICO Capital expects the naira to stay in a similar range, noting that most transactions in the official market occurred between ₦1,502.85 and ₦1,548 per dollar on Tuesday.
Coronation Research reported that foreign currency inflows into Nigeria’s autonomous forex market increased by 18.13% in a week, reaching $769.4 million. The CBN contributed 34.56% of the inflow, but this heavy intervention is reducing Nigeria’s foreign reserves, now below $40 billion. Other sources of forex included foreign investors (30.07%), private companies (21.51%), exporters (13.38%), and miscellaneous sources (0.48%).
In the meantime, following weeks of fall, oil prices somewhat increased. Concerns about decreased demand as a result of China’s faltering economy and warming global temperatures were somewhat allayed by disruptions in Libya’s oil supply. West Texas Intermediate (WTI) was trading at $73.25, while Brent crude was trading at $77.20 a barrel. Due to investor concerns over U.S. tariff measures, gold prices also recovered to $2,751.66 per ounce.
