Category: General

Naira Strengthens By 0.90% As Dollar Supply Increase

Dollar to naira exchange rate today

The Nigerian Naira has appreciated significantly against the US dollar, marking a 0.90 per cent increase as the official foreign exchange (FX) market saw a surge in supply this Tuesday.

According to data from the FMDQ Securities Exchange, the Naira closed at N1,603.38 per dollar, a significant improvement from Monday’s rate of N1,617.96 at the Nigerian Autonomous Foreign Exchange Market (NAFEM).

The intraday trading witnessed the Naira climbing to a high of N1,637 per dollar from Monday’s low of N1,650/$1, and the day’s lowest exchange rate also strengthened, closing at N1,425.35 compared to N1,511 the day before.

This appreciation was fueled by a 27.09 percent increase in the dollar supply in the market. On Tuesday, transactions totaled $122.18 million, a substantial rise from $96.13 million recorded on Monday.

Contributors to this supply include banks and other willing sellers and buyers in the FX market.

Parallel market figures also mirrored this positive trend, with the Naira appreciating by 0.81 percent to the average of N1,605 against the dollar.

Exchange rates in this sector saw dollars being traded within a range of N1,600 to N1,612.

Market analysts link this fortuitous uptick to the Central Bank of Nigeria’s (CBN) recent decision to hike the Monetary Policy Rate by 400 basis points to 22.75 percent, up from 18.75 percent, to combat persistently high inflation rates among other economic challenges.

Despite these gains, concerns remain about the Naira’s stability. The Economist Intelligence Unit (EIU) highlights ongoing challenges such as high inflation, negative real interest rates, and a scarcity of foreign reserves that continue to undermine confidence in the Naira, even after a 45 percent devaluation in February.

The EIU forecasts caution against expecting another devaluation but suggest that foreign borrowing might be leveraged to bolster foreign reserves, potentially stabilizing the Naira towards the end of 2024.

Looking forward, the EIU predicts a gradual weakening of the Naira, projecting an exchange rate of N1,770:US$1 by the end of 2024 and N1,817:US$1 by the end of 2025.

The report also forecasts a more significant depreciation by 2028, with an expected rate of N2,381:US$1, attributed to monetary and fiscal policy challenges and fluctuating world oil prices.

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Senate Explains N3.7 Trillion Provision In 2024 Budget

Senate Explains N3.7 Trillion Provision In 2024 Budget

The Senate has said the N3.7 trillion allegedly added to the 2024 budget was statutory transfers to first-line charge agencies of government not domiciled in the ministries.

The Chairman of the Senate Committee on Media and Publicity, Senator Yemi Adaramodu, made this known while speaking with journalists on Tuesday after plenary.

Recall that the lawmaker representing Bauchi Central, Senator Abdul Ningi, in an interview with BBC Hausa last Saturday, alleged that the 2024 budget was padded with N3. 7 trillion, but the Senate denied such a claim.

Speaking further, Adaramodu said there was nothing like budget padding, stressing that the claim by Ningi was a demonstration of the error of arithmetic and innocence of procedure by the protagonists of budget padding.

The Senate spokesman asserted that the Red Chamber needed to be treasured as a pillar of democracy and would only do what would promote national interest.

He said: “The N3 trillion is for statutory transfers of government agencies on the first lines charges.

“It is a matter of integrity. The issue of the budget has been put to rest as the protagonists of the budget padding were called to substantiate, and they could not prove it, but the allegations can not just go without being attended to.

“The Appropriation Act is a public document, and when it was done, it was done in the public glare, and it was N28.77 trillion, and so for some to say N25 trillion was what was approved is scary.

“Statutory transfers for agencies on first line charges, that are not domiciled in the ministries was what Mr Ningi said was padded, that the allocation cannot be traced.”

He listed the agencies to include Independent National Electoral Commission (INEC), Universal Basic Education Commission (UBEC), Public Complaints Commission, National Judicial Council, North East Development (NEDC), and Niger Delta Development Commission Commission (NDDC), among others.

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