Tuesday, December 10, 2024 -The Centre for Promotion of Private Enterprise, CPPE has given reason for the sharp appreciation of the naira against the dollar.
Explaining the sharp appreciation, CPPE attributed the increase to
improvements in the country’s external reserves and interventions by the
Central Bank of Nigeria.
The Director of CPPE, Muda Yusuf, disclosed this in a statement on
Sunday.
His comments come as the Naira gained N127 to close at N1,535 per dollar
on Friday last week compared to N1,660 against the dollar last week Monday.
Reacting to the significant gain of Naira at the FX market, CPPE
attributed it to the rise in Nigeria’s external reserves to over $40 billion in
the last few days.
Additionally, the economic think tank group said that the CBN’s recent
introduction of the Electronic Foreign Exchange Matching System (EFEMS) has
contributed to the Naira’s stability in the FX market.
“You can ascribe this to several issues. First, we have seen an
improvement in our reserves, which reached the $40bn mark a few weeks ago, and
that implies that the CBN has more power to intervene in the market, and in
truth, the CBN has been intervening in the market to stabilise the currency.
“I would like to observe that in the last five months or so, we have
seen relative stability in the naira exchange rate, which is a welcome
development.
“Now, we are beginning to see a strengthening of the currency, so the
level of our reserves has contributed to this as it elevates the confidence of
foreign investors.
“Then, in the last few months, as a result of reforms in the foreign
exchange market, we are seeing a consistent improvement in autonomous foreign
exchange inflow in the country, especially from the international money
transfer operators.”
Similarly, other experts
within the sector have attributed the strengthening of the Naira to the federal
government’s recent feat at the international market, where it raised $2.2
billion through Eurobond.
0 Comments