Naira Gains Strength as CBN Injects $245m into Forex Market

The Nigerian naira has recorded a significant gain of 2.9% at the official foreign exchange market, thanks to a recent intervention by the Central Bank of Nigeria (CBN). On September 6, 2024, the CBN injected $245.17 million into the market, causing the naira to appreciate against the US dollar.

According to data from the FMDQ Securities Exchange, the naira was quoted at N1,593.32 per dollar on Friday, up from N1,639.41 on Thursday. This represents a gain of N46.09 per dollar, marking a significant improvement in the currency’s value.

The CBN’s intervention is aimed at stabilizing the foreign exchange market and improving liquidity. The move is expected to boost investor confidence and support businesses that rely on imported goods. This is particularly important for Nigeria’s economy, which has been impacted by a combination of factors, including a decline in oil prices, low foreign exchange reserves, and high demand for dollars.

The naira has been under pressure in recent months, with a peak of N1,643.41 per dollar recorded on August 24, 2024. However, the CBN’s intervention has helped to calm the market and restore stability. The bank’s efforts to manage the foreign exchange market have been ongoing, with regular injections of dollars to meet demand and maintain stability.

Analysts believe that the CBN’s move is a step in the right direction, but more needs to be done to address the underlying issues affecting the foreign exchange market. They recommend that the CBN should continue to monitor the market closely and intervene as needed to maintain stability.

The gain in the naira’s value is expected to have a positive impact on the economy, particularly for businesses that rely on imported goods. It is also expected to boost investor confidence and support economic growth. With the CBN’s intervention, Nigeria’s economy is poised for a rebound, and the naira’s strength is a welcome development.