Tuesday Trading Sees Naira Rising Against Dollar as FX Market Reopens — In a positive turn of events on Tuesday, the Naira witnessed a noteworthy appreciation of 0.79 percent (equivalent to N8) against the US Dollar as trading in the foreign exchange (FX) market resumed post the Independence Day holiday hiatus.
The parallel market experienced a lively start with the US Dollar opening at N1,000 on Tuesday, reflecting a decrease from the N1,008 recorded on the preceding Friday. This positive momentum for the Naira is a beacon of optimism as trading activities kick-start after the national holiday.
A similar upbeat trend was observed at the Investors’ and Exporters’ (I&E) forex window, where the Naira enjoyed a heftier appreciation of 2.59 percent. As per the data disseminated by FMDQ, the US Dollar, previously quoted at N775.31 last Thursday, adjusted to N755.27 this Friday, marking an encouraging scenario for the Nigerian currency.
Analysts point to a moderated demand for the US Dollar as the driving force behind the Naira’s appreciation. The financial community is keenly anticipating the forthcoming policy actions of the recently appointed Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, whose strategic moves are expected to be crucial for the currency market.
Cardoso, backed by the confidence of the Senate which recently confirmed him as the CBN Governor (along with four deputy governors), has unveiled his ambitious plan to overhaul the apex bank’s current operational framework. With a clear immediate objective, Cardoso is determined to aggressively tackle the enormous foreign exchange obligations that have been exerting pressure on the Naira, thereby creating economic strain.
In light of the current downturn faced by the Naira, which is perceived as a significant economic challenge, Cardoso’s proactive and robust approach to offsetting the hefty foreign exchange obligations is anticipated to provide much-needed relief and stability to the currency.
