Categories: Exchange Rates Headline

Naira rebounds in black market, continues to crash at the P2P window

Iin the P2P market, the naira however lost some ground as it traded at about N980/$ in the early hours of Monday.

Advertisement
Advertisement

Naira rebounded in the black market but continued to crash at the P2P fx window.

 

Newsonline Nigeria reports that the value of the naira increased significantly on Sunday on the black market due to the high possibility of more foreign exchange inflows in Africa’s largest economy.

 

This Nigeria news platform understands that the optimistic emotions sparked by FG’s promises to support dollar liquidity in the foreign exchange (FX) market arbitrarily strengthened the local currency.

 

ALSO: Asari Dokubo blasts President Tinubu over lopsided appointments (VIDEO)

 

This positive sentiment led to street traders purchasing dollars at a rate of N901 over the weekend, as opposed to N1,050 on Friday of last week.

Meanwhile, Newsonline Nigeria reports that in the P2P market, the naira however lost some ground as it traded at about N980/$ in the early hours of Monday.

 

However, the naira lost ground in the P2P market as it was trading around N980/$ in the early hours of Monday Operators of domestic exchange bureaus the recovery and stability of the naira versus the dollar at the week’s rate could be supported by injecting liquidity into the retail sector of the foreign exchange market.

 

Chairman, of the Association of Nigerian Foreign Exchange Bureaus (ABCON), Aminu Gwadabe, said the FG must maintain the flow of dollars into the market, to cut off the influence of speculators in the market.

CBN’s Efforts and Impact

The Central Bank of Nigeria last week began clearing about $7 billion in backlog of foreign exchange futures contracts – a move expected to bring relief to the naira, community businesses, and the country’s battered economy.

CBN’s helmsman, Yemi Cardoso, highlighted that the naira will adjust once the rules for market participants are clear.

CBN settled outstanding FX futures contracts owed to several banks, including Citigroup, Standard Chartered, and Stanbic IBTC.

Local banks have not been completely liquidated, but sources close to the president said they will be next on the list. Nigeria hopes to secure about $10 billion in new capital flows to resolve its foreign exchange backlogs.

Finance Minister Wale Edun also said on Monday that Nigeria expects foreign exchange inflows of $10 billion in the coming weeks to improve liquidity in the foreign exchange market.

He said without elaborating that the inflow would come from the issuance of dollar instruments, oil sales, and foreign investments.

US Federal Reserve’s Actions

The naira also faces fewer external shocks as the US Federal Reserve (which, according to recent reports, has maintained its key interest rate band at between 5.25% and 5.50 % for the second time at the November meeting.

This move comes from persistent inflation concerns despite strong economic growth in the third quarter and a significant increase in jobs.

Fed benchmark rate remains at its highest level in 22 years after a series of rate hikes that began in March 2022 to fight inflation.

Concerns about a recession are growing as US long-term interest rates hit a 16-year high of 5% in October, along with a rise in Treasury yields.

Uncertainty about U.S consumer spending also looms as student loan payments resume after suspensions related to the COVID-19 pandemic.

Advertisement
NewsOnline Nigeria

Recent Posts

  • Economy And Business

BREAKING: PDP Knocks President Tinubu Over Deadly Stampede For Food

PDP has knocked President Tinubu over a deadly stampede for food across states and FCT…

9 hours ago
  • Economy And Business

BREAKING: NASS Asked To Cut N9.4bn Presidency Budget For Travels, Meals

NASS Leadership has been asked to cut the N9.4bn Presidency budget for travels and meals,…

10 hours ago
  • Economy And Business

BREAKING: FG Breaks Silence Over Ibadan, Abuja, Okija Tragic Stampedes

FG has broken the silence on the Ibadan, Abuja, and Okija tragic stampedes.   NewsOnline…

10 hours ago
  • Headline

Former President Buhari Expresses Deep Sorrow Over Tragic Stampedes

Former President Buhari has expressed deep sorrow over the recent tragic stampedes.   NewsOnline Nigeria…

10 hours ago
  • Top Stories

FG To Renovate Tinubu, Shettima’s Official Quarters With ₦6.36 Billion In 2025

FG is set to renovate Tinubu and Shettima’s Official Quarters With ₦6.36 billion in 2025.…

20 hours ago
  • Top Stories

FG Budgets ₦27 Billion For Buhari, Jonathan, Others’ Entitlements In 2025

FG has budgeted ₦27 billion for Buhari and Jonathan among others’ entitlements in 2025.  …

20 hours ago