The naira strengthened at the official window in the past week to 1,547/$ from 1,549/$, supported by intervention from the Central Bank of Nigeria, which injected dollars into the market to ease corporate demand pressures.
Analysts also alluded the development to the resilience of the naira to foreign exchange inflows from foreign portfolio investors. Cordros Capital Limited, in an investor’s note, revealed that FPIs brought in dollars to participate in the Open Market Operation auction by the CBN.
The CBN conducted an OMO auction driven by its continuous effort to absorb excess system liquidity. The Central Bank offered N600bn across the 155-day and 204-day tenors, attracting strong investor interest with total subscriptions reaching N1.14tn. Ultimately, the CBN allotted N1.07tn, with stop rates clearing at 24.20 per cent and 24.59 per cent, respectively.
The 0.13 per cent week-on-week appreciation in the naira is an extension of the gains that the currency has been making since the beginning of the month at the NFEM. However, in the black market, the naira weakened slightly to N1,585/$.
