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Naira ends week with N30 gain in black market as liquidity improves - BUSINESSDAY
The naira gained N30 in the black market at the end of the week, while it closed flat at the official window as improved liquidity boosted the foreign exchange (FX) market.
After trading on Friday, the naira gained 1.9 percent as the dollar was quoted at N1,550 compared to N1,580 quoted on Friday last week in the parallel market, also known as black market.
The Nigerian Foreign Exchange Market (NFEM) window recorded an inflow of US$1.19bn last week compared to US$1.10bn recorded in the prior week, according to data from Coronation Merchant Bank.
Against other currencies in the black market, the naira traded steady at N2,020 er pound, N1,690 per euro, N1,150 per Canadian dollar and N215 per Chinese yuan.
The naira ended the week flat at the official market, closing at N1,536.82 per dollar on Friday as against N1,536.89/$1 closed on Friday last week, at the NFEM.
The local currency depreciated in the official FX market for three days closing at N1,538.66 on Thursday, according to data from the Central Bank of Nigeria (CBN).
The CBN accounted for 39.85 percent of the total inflow last week, Foreign Portfolio Investments (FPIs) 18.09 percent, non-bank corporates 23.81 percent, exporters 15.67 percent, while other sources accounted for 2.58 percent. Last week, the CBN accounted for 14.29 of the total FX inflow.
Aloysius Uche Ordu, a member of the Monetary Policy Committee (MPC), highlighted the recent appreciation of the naira and improvements in Nigeria’s foreign exchange reserves.
“The naira appreciated by 13.6 percent against the US dollar between November 2024 and January 2025, reflecting improved foreign exchange inflows and effective monetary policies,” Ordu said. “This appreciation is attributed to higher oil revenue, increased remittances, and foreign investment inflows, as well as enhanced exchange rate management by the CBN.”
The stability in the foreign exchange market has bolstered confidence among businesses and consumers, reducing import costs and supporting domestic price stability. Ordu also emphasized that Nigeria’s external reserves have remained strong, reinforcing exchange rate stability and sustaining investor confidence.
“The CBN’s continued efforts to increase reserves through non-oil exports, diaspora remittances, and foreign investment inflows have contributed to this positive trend,” he noted. “As a result, the economy is better positioned to withstand external shocks, ensuring a more resilient financial environment for businesses and consumers.”
Ordu further pointed out that stabilising oil prices and increasing global demand for Nigerian crude have helped sustain foreign exchange inflows, which in turn support economic growth projections for 2025.
