The Naira showed resilience on Tuesday, opening at 1,398.24 per dollar in the Nigerian Foreign Exchange Market (NFEM).
While the rate initially touched a high of 1,398.82, it strengthened to 1,396.24 per dollar by the mid-morning sessions as supply from the Central Bank of Nigeria (CBN) and authorized dealers successfully met market demand.
Dealers noted that the apex bank’s proactive stance has ensured the “willing-buyer-willing-seller” model remains effective, preventing the speculative volatility that has historically impacted Tuesday morning trading.
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Analysts attribute this stability to the CBN’s regular supply to Bureau De Change (BDC) operators, which has improved access to foreign exchange and lowered the demand for high-cost transactions in the informal market.
Several macroeconomic factors are supporting this trend, including Nigeria’s gross foreign reserves recently climbing above the $50 billion mark, which serves as a “formidable defense against currency volatility and external shocks.”
Additionally, with headline inflation dropping to 15.10% in the most recent reports, the Naira’s real value has stabilized, increasing its appeal to both local and international investors.
This stability is further backed by steady crude oil production at 1.46 million barrels per day, providing a consistent flow of foreign currency.
Furthermore, following a 50-basis-point cut in the Monetary Policy Rate (MPR) to 26.5% last month, the market has transitioned into a phase that “favours long-term capital inflows.”
