“N789/$”: Naira Begins New Week Strong Against Dollar as Experts Predict More Wins

• The naira showed strength against the US dollar in the black market, regaining about N110 to a dollar
• At the official market, the naira also traded at N789 against the dollar as of Friday, October 27, 2023
• Financial experts believed the government's actions to beef up the naira against the dollar were finally paying off

Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.

Checks by Legit.ng show that the naira rebounded against the dollar on Monday, October 30. It traded at N1,200 against the dollar in the parallel market as against the N1,310 it traded for most of last week.

Analyst said the development was the most the Nigerian currency gained in the last three weeks after being battered by speculative demands.

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Naira ends the week on a strong note

At the official NAFEX, the naira showed strength against the US greenback, trading N789 to a dollar as against the N837.10 it traded on Thursday, October 26, 2023.

The naira has experienced a resurgence against the dollar since the Nigerian government promised to pump about $10 billion into the economy.

As per reports, the Nigerian government expects about $7 billion inflow from a consortium of investors led by Standard Chartered Bank and another $3 billion from the emergency oil swap deal between the Nigerian National Petroleum Company Limited (NNPCL) and the Afrim Bank.

The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said at the Nigeria Economic Summit Group Conference in Abuja that the country will get about $10 billion in the coming weeks.

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James Odigie, financial analyst and an investment banker, told Legit.ng that there is a possibility that the funds have come in.

“Right now, all cards are on the table, and I believe the government’s priority has shifted to strengthening the naira.

The much-talked-about speculators are in government and must have sensed that the government is not bluffing this time.

So, it is inevitable that the Forex inflows the minister talked about have come in,” Odigie said.

Nigeria reportedly battled Forex backlog to the tune of $7 billion, which has been blamed for the crash of the naira against the dollar.

The backlogs have also eroded trust in the Forex market, pushing importers and exporters into the arms of street dealers who continue to cause a drop in the country’s currency.

Aside from the inflows mentioned by Edun, the Nigerian government is also reportedly seeking to securitise its dividends from the Nigerian Liquified Natural Gas (NLNG).

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Legit.ng reported that the Federal Government decided to convert about $7 billion of Nigeria’s dividends from the Nigerian Liquified Natural Gas (NLNG) to a loan to boost foreign currency liquidity in the Nigerian economy and strengthen the troubled Forex market.

ThisDay quoted a top official in the Nigerian government as disclosing on Thursday, October 26, 2023, that as the Nigerian government expedites action to securitise the NLNG dividends, it is also expecting about $7 billion from a consortium led by Standard Chartered Bank.

The Federal Ministry of Finance Incorporate (MOFI) is organising the inflows, which is an NLNG shareholder.

Frank Ibe, a former banker and entrepreneur, said the rise and fall of the naira is mostly speculative but did not rule out the fact Nigeria is battling Forex scarcity.

“Speculators are largely responsible for the rise and fall of any currency. Apart from the fact that Nigeria does not earn enough foreign exchange, the activities of black market dealers are dealing a deadly blow to the naira,” Ibe said.

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Naira bounces back, appreciates by over N200 against US dollar in hours at P2P market

The Naira bounces back appreciates by over N200 against the US dollar in hours at the P2P market

Legit.ng earlier reported that speculators hoarding the dollar were given a rude awakening on Friday, October 27, 2023, as the naira, within hours, appreciated by N166 to the dollar in the Peer to Peer market.

Financial technology companies and cryptocurrency companies mainly use the P2P market.

Checks by Legit.ng showed that the exchange rate of the naira, which began on Friday, October 27 at N1279/$, is trading at N1,070 as of this report.

Source: Legit.ng