Naira Strengthens to ₦1,597.7/$1 at Official Market as CBN Policies Begin to Take Hold
The Nigerian naira gained strength against the US dollar on Monday, closing at ₦1,597.7/$1 in the official foreign exchange market. This represents an improvement of ₦9.3, or 0.58%, from Friday’s rate of ₦1,607.0/$1, according to figures released by the Central Bank of Nigeria (CBN). Intra-day data showed trading ranged from a high of ₦1,605.05/$1 to a low of ₦1,595/$1, with an average of ₦1,600.3/$1.
The naira’s gains weren’t limited to the official market. It also appreciated in the parallel (black) market, trading at ₦1,623/$1 on Monday, up from ₦1,630/$1 on Friday. This has narrowed the gap between the two markets to ₦25.3, one of the closest margins seen in recent weeks. Against the British pound, however, the naira continued to show weakness, trading at ₦2,113.36/£1.
Market analysts suggest this rebound is largely due to improved FX supply from the CBN and increased remittance inflows. The apex bank’s ongoing efforts to clear FX backlogs and boost transparency appear to be restoring confidence in the official market. David Omale, a Lagos-based financial analyst, said the tighter spread between official and parallel rates signals a decline in speculative demand for dollars.
The CBN has been firm in its approach to unifying the exchange rate and improving liquidity. Governor Olayemi Cardoso, speaking at the World Bank’s Nigeria Development Update, reiterated the bank’s commitment to orthodox monetary policies. He highlighted a notable decline in exchange rate volatility—from 4% a year ago to just 0.5%—as proof of policy effectiveness.
Looking ahead, all eyes are on the upcoming inflation report from the National Bureau of Statistics. While inflation spiked earlier due to fuel and food costs, some analysts believe April may bring relief. The CBN has maintained the monetary policy rate at 27.5%, with Cardoso signaling continued focus on price and financial stability as the bank works to stabilize the naira and tame inflation.
Source: Nairametrics