The Nigerian Naira has started the new month on a positive trajectory, appreciating against the United States dollar to N1,278.58 from N1,309.39 per dollar recorded last week Thursday.
This represents an increase of N30.81 at the close of trading activity.
This appreciation marks a significant milestone as it is the first time since January 26 of this year that the indicative exchange rate for the Nigerian Autonomous Foreign Exchange Market has closed below the N1,300 ceiling.
The recent strengthening of the Naira is attributed to various forex policies implemented by the Central Bank of Nigeria (CBN), which have enhanced liquidity in the forex market.
Related News: FG to Prosecute Economic Saboteurs Over Naira scarcity, Bamidele Reveals Plans
These policies include the unification of exchange rate windows, liberalisation of the FX market, clearance of FX backlog obligations for banks and airlines, and other reforms aimed at improving efficiency and transparency in the forex market.
Furthermore, the CBN’s move to clear all verified FX backlogs, including the final tranche of $1.5 billion, has contributed to the strengthening of the Naira.
The increased supply of dollars to the foreign exchange market by $2.5 billion in the last two weeks has also played a role in bolstering the Naira’s value.
Currency traders have noted a decline in demand for the US dollar, coupled with the CBN’s decision to sell foreign exchange directly to operators at competitive rates, as key factors driving the appreciation of the Naira.
The resumption of forex transactions after the Easter holiday saw the Naira appreciating at the parallel market to N1,220.
Looking ahead, analysts predict that the Naira will maintain its positive trend in April, supported by the CBN’s continued efforts to mop up liquidity and attract more capital.
The reactivation of Bureau De Change operators has also contributed to enhanced dollar liquidity in the retail segment of the forex market.
Overall, the appreciation of the Naira against the US dollar reflects increased investor confidence and economic stability, providing optimism for the Nigerian economy.
You can also read: Pictures: Anambra Police Destroy Insurgent Camps, Recover Weapons