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Buhari’s return deepens naira gains, trades at 455/dollar

Indication emerged Friday that the positive impacts of President Muhammadu Buhari’s return from London extended to the performance of naira same day as naira firmed at 455 to a dollar amid liquidity boost in the Bureau De Change and parallel market segments of the forex market.

Naira maintained steady appreciation on both the official and black markets since Friday morning on the breaking of the return news.

 

Also, local currency appreciated against the pound sterling and euro as it traded at 545 and 470 to both currencies, respectively.

Besides, Deposit Money Banks and Travelex, and even international money transfer services operator, sold the naira at 381 to a dollar.

The latest intervention of the Central Bank of Nigeria (CBN) was $100m which raised dollar injection by the apex bank to $1.14bn in a period of two week.

Analysts say the major cause of the steady appreciation n is that currency speculators are now in deep trouble as all they amassed waiting for record depreciation has failed.

Many of them are now joining the apex bank to even inject more to the market, thus giving more rooms for naira appreciation which translates goodness for the ailing economy.

However, the country’s overnight lending rate dropped to around 12 per cent on Friday from 16 per cent a week earlier as maturing bills and government budget disbursements pumped more cash into the money markets.

Some traders who spoke to our correspondent at the markets said in unison that the market opened on Friday with a cash balance of N9bn, against a deficit of about N2.3bn last week. The central bank repaid about N70bn in matured bills on Thursday to boost liquidity.

Another sweet new stemming on President Buhari’s return is the climaxing appreciation of the country’s foreign exchange reserves which rose above $30bn as of March 8 to its highest level since October 2015, the CBN data indicated also yesterday.

International report say the country’s dollar reserves have increased by 15.02 per cent since the start of the year, data showed, but are still far off their peak of $64bn hit in August 2008.

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