Nigeria’s foreign exchange (FX) reserves have surged to a three-month high of $33.58 billion, reflecting recent stability in the naira. Data from the Central Bank of Nigeria (CBN) shows that the reserves last peaked at this level on March 28, at $33.82 billion. After experiencing fluctuations and dipping to a low of $32.11 billion on April 19, the reserves have climbed by $1.47 billion over the past two months, reaching $33.58 billion on June 19.
The naira has maintained relative stability, trading between N1480 and N1490 in recent weeks, with an average exchange rate of N1,481/$1 this month. On Thursday, the naira closed at N1,485.36, marking a slight depreciation of 0.15% from N1,483.02 the previous day, according to official data from the FMDQ Securities Exchange Limited. In the parallel market, the naira remained steady at N1,490 per dollar.
This improvement in the naira’s stability is partly due to Nigeria securing a $2.25 billion loan from the World Bank to support economic reforms. Fitch Ratings, an international credit rating agency, projects that the naira will end the year at N1,450. Rand Merchant Bank in Lagos also forecasts a strengthening of the naira in the coming months as pressure from forward central bank foreign exchange contracts eases, following the market’s absorption of $1.3 billion in May.
Additionally, there has been improved liquidity in forex turnover, with the average daily turnover for June reaching $199 million, up from $168 million in May. The total forex turnover for June has now reached $2.1 billion over 11 trading days.
Credit: Businessday NG (Text Excluding Headline)
