New exchange rate emerges as naira gains against dollar at N1,453 in official market

The Nigerian currency, the naira, gained over N80 against the US dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, March 21, 2024, following the announcement by the Central Bank of Nigeria (CBN) that it has cleared all valid FX backlogs.

Data from NAFEM shows that during the mid-day trading, the naira traded at N1,382.35 per dollar before closing at N1,453 per dollar as against the rate it closed on Wednesday, March 20, 2024, at N1,536.83.

Naira gains 10% against the dollar

The development represents a 10% gain by the Nigerian currency against the dollar as Forex inflow rose to $288.47.

Traders quoted the intraday exchange rate at N1,598.00 and a low of N1,300 per dollar. On Wednesday, March 20, the Nigerian apex bank revealed that it cleared the backlog of $7 billion in claims, CBN’s Acting Director of Corporate Communications, Hakama Sidi Ali, said in a statement.

CBN offsets FX backlogs

Per Ali’s statement, the bank included $1.5 billion to offset obligations to bank customers. She stated that independent auditors from Deloitte Consulting assessed the transactions to ensure that only genuine claims were paid.

Leadership reports that the CBN governor, Olayemi Cardoso, has said that clearing the FX backlog, which analysts believe was hurting the naira, was a priority.

Cardoso said: “We prioritised clearing the FX backlog to restore credibility and confidence in the Nigerian economy.

“We needed to go through an independent and credible process that would determine the authenticity of those obligations, and, at this point, I can tell you that we have now cleared all genuine, verifiable transactions. This encumbrance to market confidence in the country’s ability to meet its obligations is behind us.”

Cardoso emphasised the priority of clearing the FX backlog to enhance credibility and confidence in the Nigerian economy.