The naira further appreciated to end the day at ₦1,598.72 against the dollar in the official foreign exchange market. This is a slight appreciation from yesterday’s close of ₦1,602.17, which shows new signs of stability in Nigeria’s currency market.
FMDQ Exchange data show that the naira appreciated by ₦3.45 against the dollar as a direct function of a better supply of foreign exchange to the market. Daily turnover was $180.80 million, better than it has been in recent weeks.
Market analysts characterize the improvement as related to recent efforts by the Central Bank of Nigeria (CBN) to clear arrears, close down speculators, and improve confidence in the official window.
In February this year, the naira traded at more than ₦1,900 to the dollar at some black market sites. The currency hit an all-time low in February 2024 before increasing after the CBN cleared outstanding liabilities and shut down the illegal forex outlets. The enforcement moderated the plunge into aggressive demand for dollars in the black market.
Since then, the local currency has been gaining steadily, and recent trading sessions have also shown higher stability in rates.
Pundits view that while the gain is welcome, more needs to be done for stabilizing the naira in the long term. Nigeria still relies on the exports of oil for foreign revenues, and any drop in global oil prices can affect supply again.
The CBN has guaranteed that it will keep on operating the system in the open and advised against panic buying. The bank will also make the market attractive for foreign investments by making it available for investors to access.
All in all, the appreciation of naira to ₦1,598.72 against the dollar reflects minor but steady improvement. While challenges still arise, the improvement provides hope towards favorable economic confidence and more investor confidence.
