Naira appreciates to N1,382/$1, as CBN continues to pump FX into market

For the ninth consecutive day, the Nigerian currency, the Naira continues to post strong performances against the US dollar at the official window to trade at N1,382.95/$1 on Tuesday March 26, 2024, data from the Nigerian Autonomous Foreign Exchange Market (NAFEM) has shown.

This represents a gain of N25.05 for the local currency when compared to the ₦1,408/$1 it traded the previous trading day.

The intra-day high was N1,486/$1 while the intra-day low was N1,300/$1 representing a lean spread of N186/$1.

Similarly, the naira appreciated against the dollar at the parallel window to trade at N1,350/$1, this represents an appreciation of N90.00 as against the N1,440 /$1 it traded the previous day.

The naira also appreciated against the British Pound to trade at N1,850/£1 as against the previous trading day’s price of N1,900/£1 representing a gain of N50 for the local currency

After over a week of closing flat, the Canadian dollar slumped against the naira to trade at N1,220| CA$1 as against the N1,270| CA$1 it traded the previous day representing an appreciation of N50 in the local currency.

READ ALSO:Naira strengthens for seventh consecutive day, trades at N1,431/$1, lowest in six weeks

The naira also gained N50 against the Euro to trade at ₦1,550/€1 as against the previous closing price of ₦1,600/€1.

The appreciation of the local currency against the foreign exchange could be linked to the influx of FX into the market by the Central Bank of Nigeria (CBN).

It would be recalled that the apex bank recently sold $10,000 to all eligible Bureau De Change (BDC) operators in the country at the rate of N1,251/$1.

In a circular issued by its Director of Trade and Exchange Department, Hassan Mahmud, and sent to the President of the Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe on Monday, the apex bank said the BDCs are to sell to eligible end users at a spread of not more than 1.5% above the purchase price.

Therefore, the BDCs are not allowed to sell above N1,269/$1.

However, many are worried that this development will lead to a depletion of the country’s foreign reserves.

It is left to be seen how long the apex bank will keep up this subtle defense of the naira.

By: Babajide Okeowo

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