Nigeria's naira ended the trading week on a steady footing, holding its ground across the country's foreign exchange markets just days after the Central Bank of Nigeria delivered a bold 350-basis-point cut to its benchmark interest rate — a sign investors have, for now, taken the aggressive easing in stride.
Steady at both windows
At the official Nigerian Foreign Exchange Market, the dollar closed at ₦1,329.51 on Friday, a marginal improvement from ₦1,331.20 the previous Friday. On the parallel market, the naira held firm at ₦1,385 to the dollar, narrowing the gap between the two segments to ₦56, or 4.21 per cent.
Market turnover moderated over the week: $711.79 million changed hands on Friday, with $2.25 billion traded across four trading days, compared with $2.74 billion over five days the previous week.
Reserves at 18-year high
The bigger talking point for analysts is Nigeria's external reserves, which climbed to an 18-year high of $54.86 billion as of September 24 — up nearly 30 per cent from $42.29 billion a year earlier. CBN Governor Olayemi Cardoso put the figure at $55.25 billion on September 18, noting it covers about 11.3 months of imports.
Economist Muda Yusuf of the Centre for the Promotion of Private Enterprise struck a cautious note, warning that the sharp rate cut — which runs against the tightening stance of some major central banks — could narrow interest-rate differentials and reduce the appeal of naira-denominated assets, risking a reversal of portfolio inflows. But he acknowledged Nigeria is entering this easing cycle with stronger external buffers than in previous episodes.
Sources: Naira Holds Firm as External Reserves Hit 18-Year High of $54.86bn
Steady at both windows
At the official Nigerian Foreign Exchange Market, the dollar closed at ₦1,329.51 on Friday, a marginal improvement from ₦1,331.20 the previous Friday. On the parallel market, the naira held firm at ₦1,385 to the dollar, narrowing the gap between the two segments to ₦56, or 4.21 per cent.
Market turnover moderated over the week: $711.79 million changed hands on Friday, with $2.25 billion traded across four trading days, compared with $2.74 billion over five days the previous week.
Reserves at 18-year high
The bigger talking point for analysts is Nigeria's external reserves, which climbed to an 18-year high of $54.86 billion as of September 24 — up nearly 30 per cent from $42.29 billion a year earlier. CBN Governor Olayemi Cardoso put the figure at $55.25 billion on September 18, noting it covers about 11.3 months of imports.
Economist Muda Yusuf of the Centre for the Promotion of Private Enterprise struck a cautious note, warning that the sharp rate cut — which runs against the tightening stance of some major central banks — could narrow interest-rate differentials and reduce the appeal of naira-denominated assets, risking a reversal of portfolio inflows. But he acknowledged Nigeria is entering this easing cycle with stronger external buffers than in previous episodes.
Sources: Naira Holds Firm as External Reserves Hit 18-Year High of $54.86bn
