The Naira appreciated significantly against the U.S. dollar, strengthening by 2.4% in the official foreign exchange market to reach a new rate of N1,278.58 per dollar. This represents a notable increase of N30.81 from its previous rate of N1,309.39 recorded before the Easter holiday. This increase comes as the Central Bank of Nigeria (CBN) continues to implement measures aimed at stabilizing the exchange rate, which has faced recent pressure due to high inflation and fluctuating dollar liquidity.
Data from FMDQ, Nigeria’s financial market infrastructure group, revealed that the Naira’s appreciation was accompanied by a sharp reduction in trading volume, which dropped to $111.18 million—down from a turnover of $857.78 million on the last trading day before the holiday. While lower trading volume could be due to holiday factors, it also reflects the reduced demand for foreign exchange at the official market rate.
However, this appreciation did not extend to other currencies, as the Naira weakened against the British Pound and Euro, trading at N1,937.00 and N1,662.83 respectively. As inflation remains a significant challenge, the Central Bank’s Monetary Policy Committee is set to meet, with discussions likely to address further policy measures to curb inflation and stabilize the local currency.
The appreciation also follows recent policy adjustments under the leadership of CBN Governor Yemi Cardoso, who has overseen two interest rate hikes since taking office. These moves aim to tame inflation, which has persisted at elevated levels for over a year, reaching 33.69% in April. As the Naira’s value fluctuates, there is cautious optimism that CBN interventions may bring greater stability to the currency in the coming months.
