Business
February 27, 2025 by Our Reporter
Naira rose against the US dollar in the foreign exchange (FX) market to settle at N1,499 in the official window yesterday.
The local currency rallied as forex market supply remained sufficient to meet aggregate demand from eligible FX users in the official window.
FX inflows fell by 46% in the forex market last week, and the Naira has remained steady with minimal fluctuations which suggests low demand pressure. Analysts said FX trading has been enhanced by a transparency, liquidity and foreign investors’ confidence. According to information obtained from the FMDQ platform, Naira appreciated by 0.16%, closing at N1,499.08 per dollar. The Central Bank of Nigeria (CBN) remain focuses on FX market price discovery, and has deployed aggressive US dollar sales to banks to strengthen market supply.
Hence, the Naira is trading strong against all foreign currency, the most prominent among which are US dollar, sterling and Euro.
The same experience in the official window has also filtered into the informal currency market where Bureau de Change (BDCs) operators are the main actors. The operators in the segment have been accessing foreign currency from Banks at official rate as instructed by Yemi Cardoso led CBN leadership.
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Today, the Naira closed at ₦1,495 per US dollar in the parallel market – maintaining its stability. Latest data from the forex market has revealed that inflows into the Nigerian autonomous foreign exchange market (NAFEM) fell by about 46% last week. In a note, Coronation Research said the NAFEM window recorded an inflow of US$980.20 million last week as against US$1.80 billion recorded in the prior week.
With sustained FX intervention, the CBN was the major contributor, accounting for 17.02% of the total inflow. Also, foreign portfolio investors (FPIs) contributed 41.03% of the total inflows into NAFEM, and nonbank corporates added 27.35%. Inflows from exporters accounted for 14.22% of the total amount in the supply side, while other sources accounted for 0.38%. Elsewhere, oil prices remained near two-month lows as an unexpected rise in U.S. fuel stockpiles signaled weaker demand, while ongoing Russia-Ukraine peace talks pressured prices. Brent crude declined 31 cents (0.42%) to $72.71 per barrel, and U.S. WTI fell 20 cents (0.29%) to $68.73. Gold prices retreated following a record rally, with investors awaiting inflation data and updates on President Donald Trump’s tariff policies. Spot gold dropped 0.7% to $2,894.55 an ounce, after hitting a record high of $2,956.15 on Monday.
Naira
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