Naira Trades Flat Ahead of Eid Fitr Celebration

naira
  • Naira Trades Flat Ahead of Eid Fitr Celebration

The Nigerian Naira traded flat against the United States Dollar at the Investors & Exporters FX Window on Thursday.

This was after President Muhammadu Buhari declared Monday and Tuesday public holidays for Muslims across the country to celebrate the Eid Fitr following 30 days of fasting.

The local currency was exchanged at N386.50 to a US dollar on Thursday, slightly up by 0.02 percent when compared with N386.42 it traded on Wednesday.

The volume of currency traded dropped from $85.61 million on Wednesday to $22.50 million on Thursday.

The Naira gained slightly this week after the Central Bank of Nigeria announced it has resumed the sales of forex to commercial banks for specific purposes.

However, the currency remained under pressure given the weak revenue generation and the uncertainties surrounding the economy at large.

Experts had predicted that the Naira could trade at over N500 to a US dollar in few years despite the central bank saying macro fundamentals remained supportive.

Earlier this week, the Fitch Ratings said the nation’s foreign reserves could plunge to about $23 billion from the current level of about $35 billion with the recent production agreement signed with OPEC and low demand for the battered commodity.

Still, investors seem bullish on the economy, especially with yield on government bond trading at a record low of about 9 percent, down from 13 percent. Another indication of investors’ interest in Nigerian assets.

 

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya

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