The naira continues to gain ground against the US dollar as the Central Bank of Nigeria (CBN) ensures a steady supply of foreign exchange (FX) to both banks and Bureau de Change (BDC) operators. This intervention has helped stabilize exchange rates, meeting the demand for foreign transactions and easing pressure on the market.
Recent trends indicate that the usual FX demand from individuals and businesses, which often pushes up rates in the parallel market, has significantly reduced. Analysts attribute this to increased access to foreign currency through banks, particularly for business and travel purposes, making competition tougher for BDC operators.
With the CBN supplying FX across both official and parallel markets, the exchange rate has remained relatively stable. Many market watchers believe this trend will continue unless the CBN changes its current strategy.
On Thursday, the naira appreciated by 0.05% in the official market, closing at ₦1,498.28 per dollar. In the parallel market, it traded at ₦1,495 per dollar. The Nigerian Foreign Exchange Market (NFEM) also maintained stability, with rates fluctuating between ₦1,496 and ₦1,500.50 per dollar.
However, Nigeria’s external reserves declined to $38.5 billion due to fluctuations in FX inflows, remittances, and crude oil revenues.
Oil Prices Surge Amid Supply Concerns
Oil prices jumped by 2% as fresh concerns over supply emerged following former US President Donald Trump’s decision to revoke Chevron’s license to operate in Venezuela. Despite this, expectations of a possible Ukraine peace deal, which could increase Russian oil exports, and an unexpected rise in US gasoline inventories limited further gains.
Brent crude rose by $1.43 (2%) to $73.96 per barrel, while US West Texas Intermediate (WTI) climbed $1.46 (2.1%) to $70.08. Meanwhile, gold prices fell to a two-week low, pressured by a stronger dollar and anticipated inflation data. Spot gold dropped 1.2%, settling at $2,882.49 per ounce.
