The Nigerian naira continued its upward trajectory against the United States dollar, reaching N1,136/$ at the official market and N1,050/$ at the parallel market by the close of trading on Monday.
Traders are now anticipating the dollar’s further decline to below N1,000 before the week concludes.
According to data from the FMDQ Exchange, the platform overseeing the Nigerian Autonomous Foreign Exchange Market, the naira strengthened by 6.1 percent or N69 from its Friday rate of N1,205/$ to N1,136/$ on Monday.
Although the total daily turnover slightly decreased to $251.60m on Monday from Friday’s $281.34m, both the intra-day high and low showed notable improvements. The intra-day high closed at N1,227 per dollar, up from Friday’s N1,265 per dollar. Conversely, the intra-day low appreciated by N100/$1, with the dollar quoted at N1,000 on Monday compared to Friday’s N1,100.
This surge in the naira’s value follows a series of foreign exchange directives issued by the Central Bank of Nigeria (CBN) aimed at stabilizing the currency. Last month, the apex bank announced the successful resolution of all valid foreign exchange backlogs, addressing inherited claims totaling $7bn, as pledged by CBN Governor Olayemi Cardoso.
Data from the FMDQ also revealed a significant increase in total inflows into the Nigerian Autonomous Foreign Exchange Market (NAFEM), rising by 41.7 percent to $3.75bn compared to $2.64bn in February, marking the highest level since March 2019 ($6.07bn).
In a recent move, the CBN reviewed the exchange rate for Bureau De Change operators to N1,101 per dollar from N1,251/$1, while planning to sell $15.88m to 1,588 eligible BDC operators.
As part of its efforts to curb inflation and stabilize the naira, the CBN raised its benchmark interest rate, known as the Monetary Policy Rate, by 200 basis points to 24.75 percent from 22.75 percent in February 2024.