Good News For Naira as Dollar Inflows Hit $57 Billion Monthly Amid Reserve Increase

• The Central Bank of Nigeria (CBN) has reported a surge in foreign exchange inflow into the Nigerian economy
• The bank disclosed that Nigeria witnessed an FX inflow of $57 billion in August this year
• The bank said diaspora remittances surged to a new high of $3.5 billion, exceeding the total of $3.2 billion recorded in 2023

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The Central Bank of Nigeria (CBN) has disclosed that foreign exchange inflows into Nigeria hit $57 billion in August 2024.

Muhammad Abdullahi, CBN’s Deputy Director of Economic Policy, updated the audience on Nigeria’s forex situation in Washington, D.C.

Diaspora inflow grows

Abdullahi stated that capital importation almost doubled to $6.9 billion in August this year, compared to $3.9 billion recorded during the 2023 financial year.

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Also, diaspora remittances surged to a new high of $3.5 billion, exceeding the total of $3.2 billion recorded in 2023.

Vanguard reports that the apex bank also reported a 100% FX inflow via the autonomous market, showing improved efficiency.

The financial institution’s regulator stressed that intervention in the forex market has crashed to just 5% of the total market turnover.

Naira recovers in official window

This comes as the Nigerian currency, the naira, bounced back against the US dollar in the official window.

Amid the euphoria of Nigeria’s foreign reserves rising to $40.2 billion, the Nigerian naira has bounced back strong against the US dollar in the official window.

The naira, which has been down in the last three days, witnessed a resurgence, gaining almost N50 in the Nigerian Autonomous Foreign Exchange Market (NAFEM).

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Spot rate gap grows as the naira rises

Data from the FMDQ Exchange shows that the naira rose 3.20% to close at N1,601.20 per dollar on Thursday, October 24, 2024, up from the N1,650 it traded on Wednesday, October 23, 2024.

Currency dealers quoted the dollar’s spot rate at a high of N1,696 per dollar and a low of N1,585.43, leaving a margin of N111.43.

The foreign exchange turnover in the official window also increased to $230.99 million on Thursday, October 24, 2024.

The naira depreciates in the parallel market as reserves rise

However, on Wednesday, October 23, 2024, the naira depreciated massively in the parallel market to N1,739 per dollar.

Source: Legit.ng