February 8, 2023

Home Economy Naira Gains Strength Against the Dollar

Naira Gains Strength Against the Dollar

by Genesis Essien

CEM REPORT | The Nigeria currency — naira pushed a growth of 0.18 percent against the United States Dollar at the Investors and Exporters (I&E) segment of the foreign exchange (FX) on Wednesday.

The Naira traded at N420/$1 compared to N420.75/$1 it traded the previous day indicating a 75 kobo strength at the close of trading day.

Meanwhile, in the Peer-to-Peer (P2P) segment of the market, the naira, depreciated against the US Dollar by N1 or 0.2 per cent to sell at N616/$1 compared with Tuesday’s rate of N615/$1.

However, at the interbank window, the local currency closed flat against the Pound Sterling and the Euro at N502.44/£1 and N434.59/€1 respectively.

With the rising debt profile of the country amidst other economic issues, insecurity and with the 2023 elections fast approaching, the Nigerian economy will receive some knocks and shocks that will take a strong naira to withstand. Therefore there is every reason to push up policies needed to further strengthen the naira to withstand those shocks and others that may arise in the future.

This is expected to take CBN some tenacity following fast shrinking oil revenue due the country’s shortfall in oil production output while expenditure is on the rise as the federal government continues to borrow to pay workers according to recent reports by the Acting Accountant General.

According to CEM report, all these have already started having impact on the nation’s foreign reserves which have continued to deplete, a trend analyst forecast may persist as those economic headwind remained un-tackled. read more

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