The naira has continued its strengthen against the United States dollar. The Nigerian currency appreciating N1,050/$ at the official market and N1,136/$ at the parallel market at the close of trading activities on Monday.
This was as traders predicted the dollar’s fall to below N1,000 before the end of the week.
At the official foreign exchange market, data from the FMDQ Exchange, a platform that oversees the Nigerian Autonomous Foreign Exchange Market, revealed that the naira surged by 6.1 per cent or N69 from N1,205/$ recorded on Friday to N1,136/$ on Monday.
The total daily turnover dropped slightly to $251.60m on Monday, from $281.34m recorded on Friday.
The intra-day high also improved significantly, closing at N1,227 per dollar from N1,265 per dollar quoted on Friday.
The intra-day low appreciated by N100/$1 as the dollar was quoted on the spot at N1,000 on Monday, stronger than the N1,100 quoted on Friday.
The improved rate followed a string of foreign exchange directives by the Central Bank of Nigeria aimed at stabilising the naira.
The apex bank last month said it had successfully resolved all valid foreign exchange backlogs, as pledged by Olayemi Cardoso, the CBN governor, addressing inherited claims amounting to $7bn.
Data from the FMDQ also indicated that total inflows into the NAFEM increased by 41.7 per cent to $3.75bn as against $2.64bn in February – the highest level since March 2019 ($6.07bn).
The apex Bank had last week reviewed the exchange rate for the Bureau De Charge operators to N1,101 per dollar from N1,251/$1 as it plans to sell $15.88m to 1,588 eligible BDC operators.
As part of measures to control inflation and stabilise the naira, the CBN last month raised its benchmark interest rate, known as the Monetary Policy Rate by 200 basis points to 24.75 per cent from 22.75 per cent in February 2024.
“We anticipate that the naira would continue to strengthen as the CBN intensifies efforts to bolster liquidity in the market,” analysts at Afrinvest said.
Last week, an investment company, Goldman Sachs Group, said the Naira had already established itself as the top-performing currency globally in April, adding that the local currency was expected to extend its gains, amid the continuing effective policy management by the Central Bank of Nigeria.
Goldman Sachs economists, who previously forecasted in February that the Naira would strengthen to N1,200/$ in 2024, now anticipate it could surpass this level due to aggressive measures by the central bank, including a total of 600 basis points in interest rate increases during policy meetings in February and March.
