Hope for Nigeria as Naira Gains Nearly N200, FG Pumps in More FX to Meet 2024 Economic Plans
- The naira rebounded against the US dollar on Tuesday, January 23, 2024, by 5.34%
- The local currency appreciated to N876.61 from the N925.34 recorded on Monday, January 22, 2023,
- The development came after the CBN prepared to carry out a Primary Market Auction (PMA)
Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
The Nigerian currency, the naira, showed resilience by recovering after a two-day losing streak at the official market.
The naira’s recovery on Tuesday, January 23, 2024, is driven by a moderation at the official FX market despite forex challenges in the economy.
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The naira appreciates by 5.32%
Data from FMDQ revealed that the naira appreciated by about 5.32% against the US dollar.
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Traders quoted the dollar at N876.61, indicating a significant improvement from the N925.34 recorded on Monday, January 22, 2023, at NAFEM, the official forex market.
Willing buyers and willing sellers participated, bidding a high of N1,336.05 and a low of N701 per dollar.
According to reports, the shift suggests a more balanced exchange rate, contributing to the naira’s positive performance.
Analysts believe the Nigerian foreign exchange rate market has suffered low dollar liquidity, which has posed a great challenge for market participants.
The daily FX turnover in the market experienced a substantial 20.28% drop to $58.46 million on Tuesday, January 23, 2024, compared to the $73.33 million recorded on Monday, January 22, 2024.
CBN to conduct special operation to boost naira performance
BusinessDay reports that the Central Bank of Nigeria (CBN) is set to carry out a Primary Market Auction (PMA) on Wednesday, January 24, 2024, to roll over Nigeria’s Treasury Bills totalling N231 billion.
The auction will comprise varying tenors, including N7.85 billion for the 91-day, N6.44 billion for the 182-day, and N217.53 billion for the 364-day tenors.
The apex bank’s decision to roll over these T-Bills underlines its commitment to managing liquidity and ensuring stability in the financial system.
Analysts predict better days for the naira
Economist and financial analyst Anthony Gabriel predicted that the days of the naira’s losing streak against the dollar are over.
He said that liquidity in the forex market would gain traction as FG intensified its effort to boost non-oil exports.
“I think we have correctly diagnosed the problem. Nigeria is not earning enough Forex, and FDI is drying up. But that is the first step in addressing illiquidity in the system.
If we step up efforts on non-oil exports, the system will self-correct and normalize in the long term. What Nigeria needs now is to export more to earn more Forex,” he said.
New ranking shows the world’s strongest currencies in 2024
Legit.ng reported that while the US dollar is globally acknowledged as the most influential currency, holding a dominant position in international trade, there are over 180 traditional currencies known as legal tender.
The US greenback does not rank among the world’s strongest currencies.
A Forbes analysis has shown the world’s strongest currencies, measuring how many units of foreign currency can be obtained in exchange for the USD.
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