Market News
Stronger dollar supply lifts naira as reserves rise - PUNCH
The naira recorded another weekly gain against the US dollar, benefiting from improved foreign exchange supply and stronger liquidity in the market.
The currency closed at N1,346.49 per dollar in the official market, gaining N11.11 over five trading days, data from the Central Bank of Nigeria showed.
The latest performance represents a 0.83 per cent appreciation from the previous week, as improved dollar availability helped moderate pressure on the domestic currency.
The parallel market also recorded a marginal improvement, with the naira closing at N1,400.61 per dollar amid relatively balanced demand and supply conditions.
Foreign investors, exporters and non-bank corporates were among the sources of dollar liquidity that supported trading during the week.
At the same time, Nigeria’s gross external reserves increased by 0.65 per cent to $52.657bn, further strengthening the country’s external liquidity position.
The combination of rising reserves and improved FX supply has boosted expectations that the naira could maintain its recent stability in the coming weeks.
Some market participants are projecting an exchange rate of about N1,350 per dollar by the end of 2026, reflecting growing optimism around the currency’s outlook.
Nigeria also received support from the commodities market, where crude oil prices extended their recent gains amid heightened geopolitical tensions.
Brent crude increased 0.61 per cent to $94.39 per barrel, while WTI rose 0.23 per cent to $87.06 per barrel on Sunday at 6.07pm.
The stronger oil prices could help bolster Nigeria’s external position through higher export earnings. However, escalating tensions involving Iran and Russia could continue to create volatility in global crude prices.
With FX liquidity improving and external reserves strengthening, the naira is expected to remain relatively stable in the near term, analysts say.
