The Nigerian Naira appreciated to N1,136 against the United States Dollar at the official market and rose to N1,050 at the parallel market.

At the official foreign exchange market, data from the FMDQ Exchange revealed that the Naira strengthened by 6.1 percent or N69 from its previous rate of N1,205/$ recorded on Friday to N1,136/$ on Monday.

This surge underscores the effectiveness of recent foreign exchange directives implemented by the Central Bank of Nigeria (CBN), aimed at stabilizing the Naira and bolstering liquidity in the market.

At the parallel market, the Naira appreciated to N1,050 against the Dollar, reflecting an improvement in the currency’s value in informal trading circles.

This resurgence has brought renewed hope to traders and businesses operating in the informal sector, as they anticipate further strengthening of the Naira in the coming days.

The improved exchange rate follows a series of strategic interventions by the CBN to address foreign exchange challenges and stabilize the Naira.

The positive momentum in the forex market has been further reinforced by a surge in total inflows into the Nigerian Autonomous Foreign Exchange Market (NAFEM), which increased by 41.7 percent to $3.75 billion in March, compared to $2.64 billion in February.

Commenting on the recent developments, analysts at Afrinvest expressed optimism about the continued strengthening of the Naira, attributing it to the CBN’s intensified efforts to bolster liquidity in the market.

They anticipate further improvements in the exchange rate as the apex bank maintains its proactive stance on forex management.

The Indian rupee found itself on a downward spiral on Tuesday as it plummeted to a historic low against the US dollar amidst regional economic turbulence.

The currency dropped by as much as 0.1% to 83.5350 per dollar, breaching its previous intraday low of 83.50 set in November, according to data compiled by Bloomberg.

Simultaneously, Indian stocks followed suit with the S&P BSE Sensex Index trading down by 0.5%.

A cocktail of factors contributed to the somber mood pervading regional markets. Notably, a drop in the value of the yuan, prompted by China’s unexpected decision to weaken its currency defense, added to the prevailing risk-off sentiment.

Also, simmering tensions in the Middle East raised fears of potential disruptions in oil supply, further exacerbating concerns.

Given that crude oil constitutes India’s largest import, the prospect of costlier oil poses a significant risk to the economy, particularly in the run-up to national elections.

Traders reacted swiftly to the weakening rupee, speculating that the Reserve Bank of India (RBI) may utilize its substantial foreign exchange reserves to intervene in the market and curb volatility.

Despite the rupee’s decline, it stood out as one of the better-performing emerging market currencies on Tuesday, experiencing a milder depreciation compared to counterparts like Indonesia’s rupiah and the South Korean won.

Kunal Sodhani, Vice President at Shinhan Bank, commented on the situation, stating, “Considering India’s FX reserves at an all-time high, the RBI may use this ammunition to curtail any kind of excessive volatility.”

He pointed to various factors, including the weakening of the Chinese yuan, the strengthening of the dollar index, and outflows from domestic equities, as exerting pressure on the Indian rupee.

While the rupee’s downward trajectory underscores the challenges facing India’s economy amidst regional uncertainties, the presence of robust foreign exchange reserves offers a glimmer of hope for stability.

However, as geopolitical tensions persist and global economic dynamics evolve, policymakers and market participants alike are bracing themselves for continued volatility, navigating the uncertain terrain of the international financial landscape with caution.

The Nigerian Naira has surged to an eight-month high of 1,120 against the US dollar on the parallel market, commonly referred to as the black market.

This significant appreciation comes on the heels of a series of foreign exchange (FX) reforms initiated by the Central Bank of Nigeria (CBN), which have effectively unlocked dollar liquidity within the economy.

According to data compiled from online platforms and street traders, the current exchange rate reflects a gain of 62.95% for the Naira against the dollar compared to its level of 1,825 per dollar in February 2024.

Market sentiment suggests that the recent strengthening of the Naira can be attributed to a subdued demand for the US dollar, coupled with ample liquidity in the market, particularly during the holiday period.

Despite a decline in external reserves, Nigeria’s currency strengthened to 1,230.61 per dollar on the official FX market before the holidays.

The recent uptick in the Naira’s value follows the CBN’s decision to review the exchange rate for Bureau De Change (BDC) Operators to 1,101 per dollar from 1,251 per dollar.

Also, the CBN announced plans to sell $15.88 million to 1,588 eligible BDCs, further bolstering dollar liquidity in the market.

The CBN’s proactive approach to FX management, including the resolution of foreign exchange backlogs amounting to US$7 billion, has instilled confidence among investors and market participants.

Furthermore, the apex bank’s commitment to implementing reforms aimed at enhancing transparency and efficiency in the FX market has yielded positive results.