Naira flat as FX market sees marginal drop in dollar supply

…Diaspora Remittances surge 433% in February- CBN

The naira closed flat at the official foreign exchange (FX) market as dollar supply dropped marginally on Thursday.

After trading on Thursday, the naira marginally gained 0.22 percent as a dollar sold for N1,602.17 as against N1,605.72 quoted on Wednesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM), data from the FMDQ indicated.

Read also: Naira weakens as dollar supply dips by 42.08%

The daily FX market turnover declined by 2.99 percent to $164.76 million on Thursday from $168.98 million recorded on Wednesday.

At the parallel market, also known as the black market, the naira steadied at N1,620 per dollar. Some street traders sold the dollar at N1,590 and N1,610/$1 in some areas.

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The Central Bank of Nigeria (CBN) has announced a remarkable upswing in Diaspora remittances, soaring by 433 percent to reach $1.3 billion in February, compared to $300 million in January.

Revealing this development during a press briefing in Abuja, Hakama Sidi Ali, acting director of corporate communications at CBN, emphasized the significant surge in overseas remittances, surpassing fourfold the figures from the previous month.

She highlighted that foreign investors exhibited keen interest in Nigerian assets, with investments exceeding $1 billion in February alone. Moreover, total portfolio flows for 2024 have reached $2.3 billion, indicating a promising trajectory compared to the $3.9 billion recorded for the entirety of the previous year.

Furthermore, Ali indicated that the momentum of higher foreign exchange inflows persisted into March 2024, attributed to heightened investor appetite for short-term sovereign debt following adjustments to benchmark interest rates.

Notably, government securities issuances witnessed substantial oversubscription, with foreign investors dominating bids, accounting for over 75 percent of the total bids received during auctions conducted on March 1 and 6, 2024