The Nigerian naira is expected to remain stable against the US dollar in the coming week, according to trading sources cited by Reuters. The currency’s stability is attributed to interventions by the Central Bank of Nigeria, which has been supporting the naira in the face of steady demand for the dollar.
As of Thursday, the naira was trading at 1,445 to the US dollar on the official market, a slight improvement from the 1,447 rate recorded a week earlier. In the parallel market, the naira was exchanged at 1,475 to the dollar. A trader expects the naira to trade within a narrow range of 1,443-1,450 naira next week, anticipating no significant fluctuations.
The Central Bank of Nigeria has been actively intervening in the foreign exchange market to maintain stability and prevent sharp depreciations of the naira. This intervention, combined with steady dollar demand, is expected to keep the naira relatively stable in the short term. The naira’s performance is closely watched by investors and businesses, as it has a significant impact on Nigeria’s economy, which is the largest in Africa.
Nigeria’s economy has been facing challenges in recent years, including a decline in oil prices, which has put pressure on the country’s foreign exchange reserves. The Central Bank of Nigeria has implemented various measures to conserve foreign exchange and stabilize the naira, including restricting access to foreign exchange for certain imports and introducing a flexible exchange rate regime.
The stability of the naira is crucial for Nigeria’s economic growth and development, as it affects the cost of imports, inflation, and the overall competitiveness of the country’s businesses. As the Nigerian economy continues to evolve, the performance of the naira will remain a key indicator of the country’s economic health. With the Central Bank of Nigeria’s continued intervention and the steady demand for the dollar, the naira is expected to remain stable in the coming week, providing a sense of relief for investors and businesses operating in the country.