Emmanuel OchayiThe Naira is on a winning streak as parallel market operators offer a buy price of N1400/$1, signaling a significant strengthening against the dollar.
In conversations with Prime Business Africa, traders in the parallel market disclosed that the Naira’s value has surged, jumping from around N1600/$1 to N1500/$1 (some quoted N1550/$1) for potential buyers.
Muhammed, a trader in the market, expressed delight, saying, “A stronger Naira is good for business.”
The official market also witnessed a positive trend, with the exchange rate dropping to N1,560/$1 on Tuesday, marking the currency’s strongest performance since early March.
The surge in Naira’s value comes amidst speculators offloading their dollar reserves due to diminishing demand.
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The Central Bank’s forthcoming Monetary Policy Meeting holds significance as it decides on interest rates. At its previous meeting, the apex bank hiked the MPR by 400 basis points to 22.75%, the largest single increase on record.
Foreign investors’ keen interest in CBN’s OMO auction and Nigeria’s Treasury bills may have contributed to the Naira’s recent gains. The apex bank reported that foreigners dominated these auctions, accounting for about 75% of subscribers.
The surge in forex inflow is another contributing factor. Remittances from Nigeria’s diaspora spiked to $1.3 billion in February, a fourfold increase from the previous month’s $300 million.
The Naira’s strengthening trend underscores the potential resilience of Nigeria’s currency amidst economic fluctuations. As the parallel market hits the N1400/$1 mark, stakeholders remain cautiously optimistic about the currency’s trajectory in the coming days.
