N1,356/$: Naira Opens Week Stronger Against US Dollar in FX Markets
- The naira opened the week stronger in the official market, gaining 70 kobo against the dollar
- Exchange rate data showed the currency also appreciated against the pound sterling and euro
- Expert have shared insight into naira's performance and movement in Nigeria’s external reserves
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The naira opened the week on a positive note, appreciating against the United States dollar in the official foreign exchange market to N1,356.19/$1 on Monday, April 13.
Data from the Nigerian Foreign Exchange Market (NAFEM) showed that the Nigerian currency gained 70 kobo compared with the previous closing rate of N1,356.89/$1.
Source: Getty Images
New exchange rate
The naira also strengthened against other major currencies in the official market. It appreciated against the pound sterling by N3.67 to close at N1,825.15/£1, compared to N1,828.82/£1 recorded last Friday.
Similarly, it improved against the euro by N4.89 to settle at N1,587.69/€1, from N1,592.58/€1 in the previous session.
At the GTBank FX desk, the naira appreciated by N3 to N1,373/$1 from N1,376/$1, while it remained stable at N1,385/$1 in the parallel market.
Meanwhile, interbank turnover surged significantly to N114.887 million across 141 deals, up from N71.156 million recorded on Friday, according to data published on the Central Bank of Nigeria (CBN) website.
However, FX inflows into the NAFEM window declined sharply to $571.80 million from $1.06 billion recorded in the previous week, according to a research report by Coronation Merchant Bank. This suggests relatively tighter foreign exchange supply conditions.
The CBN has reiterated its commitment to stabilise the naira and boost dollar inflows.
Latest rates as published by the CBN
- CFA: N2.42
- Yuan (Renminbi): N198.53
- Danish Krona: N212.44
- Euro: N1,587.69
- Japanese Yen: N8.49
- Riyal: N361.34
- South African Rand: N82.07
- SDR: N1,858.11
- Swiss Franc: N1,721.05
- Pound Sterling: N1,825.15
- US Dollar: N1,356.19
- WAUA: N1,858.44
- UAE Dirham: N369.20
Source: Getty Images
Naira stability comes at a cost
Reacting to the naira’s performance, Lukman Otunuga, Head of Market Research at FXTM Academy, said the relative stability of Nigeria’s currency amid global volatility is commendable but has come at a significant cost, the Nation reports.
He noted that the naira currently ranks as the second-best performing African currency against the dollar year-to-date, trailing only the Zambian kwacha.
Otunuga disclosed that Nigeria’s external reserves has declined for 16 consecutive days through April 8, dropping to $48.94 billion, the lowest level since mid-February.
He explained that the Central Bank of Nigeria has maintained its commitment to defending the local currency, particularly in March.
Dangote predicts naira to dollar exchange rate
Legit.ng earlier reported that the chairman of the Dangote Group, Aliko Dangote, has predicted a strengthening of the Nigerian naira, saying the currency could reach N1,100 to $1 this year.
Dangote made the comments during the launch of the Nigeria Industrial Policy in Abuja, an event attended by Vice President Kashim Shettima, the Secretary to the Government of the Federation, George Akume, representatives from the Manufacturers Association of Nigeria, the United Nations, and industry leaders.
Source: Legit.ng
