The naira began the new week on a weaker note, trading at ₦1,533.67/$ at the Nigerian Foreign Exchange Market listed on the Central Bank of Nigeria (CBN) website. This marked a slight dip from Friday’s closing rate of ₦1,532.51/$, representing a 0.08 per cent decline.
During intraday trading, the exchange rate peaked at ₦1,535/$ and fell to a low of ₦1,532/$, even as Nigeria’s external reserves climbed to $40.72bn as of last Wednesday.
At the parallel market, the currency closed at ₦1,543/$, slightly stronger than the average of ₦1,545/$ recorded the previous week.
The naira was earlier projected to trade mostly stable at the official window this week, supported by continued interventions by the CBN and improved foreign exchange inflows.
“However, headwinds from a stronger US dollar and softening crude prices could limit further gains. Barring major shocks in global markets, the currency should hold steady, with intermittent pressure from external factors. In the parallel market, rates are also projected to remain unchanged, unless speculative demand or supply constraints arise,” stated Cowry Research.
In its weekly market update, AIICO Capital revealed that the CBN sold about $166m in the past week. The firm noted that, in the short term, it expects the “FX market to retain its current stability, supported by the Central Bank of Nigeria’s ongoing policy refinements and fiscal measures aimed at sustaining liquidity.”
Cordros Capital Limited echoed a similar outlook. In a note, the firm stated, “We expect sustained inflows from foreign portfolio investors due to existing carry trade opportunities and stronger market confidence. Improving non-oil exports, as well as limited incentives for naira speculation, are expected to reinforce steady inflows from domestic sources.”
