Nigeria’s external reserves have soared to $41.046 billion, marking the highest level in the last four years. This sharp rise has provided a significant boost to the value of the Naira, which has appreciated further in the parallel market.
The Central Bank of Nigeria (CBN) revealed that the reserves grew by $3.836 billion or 10.3% over just two months, from $37.21 billion on June 30.
This increase has led to an ongoing positive impact on the Naira’s exchange rate. On August 21, the Naira strengthened for the fourth consecutive day, appreciating to N1,545 per dollar in the parallel market, up from N1,550 the previous day.
In the official Nigerian Foreign Exchange Market (NFEM), the Naira appreciated slightly, trading at N1,535.1 per dollar, which marked a modest improvement from the previous day’s rate of N1,537.99 per dollar. This reflects a $2.89 increase for the Naira in a single trading day, indicating a positive shift in the currency’s performance.
This upward movement in the official exchange rate has had a significant impact on the gap between the NFEM rate and the parallel market rate.
The difference has narrowed notably, dropping from N17.01 per dollar to N9.9 per dollar within the span of a single day. This reduction in the exchange rate gap highlights an increasing confidence in Nigeria’s economic outlook, driven by rising foreign reserves and efforts by the Central Bank of Nigeria (CBN) to stabilize the currency.
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