Naira gains over N100 against the dollar in the official market as FX inflows hit $11bn

The Naira returned against the US dollar in the official Nigeria Autonomous Foreign Exchange Market (NAFEM) on Thursday, November 7, 2023.

The recovery of the Nigerian currency came after depreciating for two consecutive days, hitting a new low of N952.13 against the US dollar on Wednesday, November 6, 2023.

Nigeria records FX inflow as naira makes a comeback

However, the Naira recorded a slight drop against the US greenback in the parallel market, exchanging at N160 per dollar as against the N157 traded the day before.

The development comes as Nigeria recorded an $11 billion foreign exchange inflow in July and August 2023, according to figures from the Central Bank of Nigeria (CBN).

The CBN data on Forex inflows through the economy says that August figures increased by 5.8% from July.

The report said: "The economy recorded a higher net foreign exchange inflow in August 2023, driven, mainly, by increased inflow from autonomous sources. Foreign exchange flows through the economy recorded a net inflow of $2.33bn, an increase of 2.9 per cent, relative to the $2.27bn in July 2023.

"Aggregate foreign exchange inflow into the economy increased by 5.8 per cent to $5.71bn in August, compared with the $5.40bn in the preceding month."

Punch reports that outflows through the apex bank rose 6.3% to $2.98 million from $2.80 billion in the prior month.

According to the report, autonomous inflow increased by 16.6% to $3.28 billion the month before.

CBN data reveals tranche payments to 31 banks

Also, autonomous outflow rose by 22.3% to 0.4 billion in August 2023 from $0.32 billion in July. It recorded a net inflow of $2.88 billion via autonomous sources, with $2.48 billion in July 2023.

The bank recorded a net outflow of $0.55bn, compared with the $0.22bn in the preceding month. On November 24,202, CBN said it had made tranche payments to 31 financial institutions to offset the FX backlogs perceived to be responsible for naira's poor performance.

The apex bank governor, Olayemi Cardoso, said there had been an improved Forex market liquidity in recent weeks as the market responded positively to part payments made to the banks, Legit.ng reported.

Cardoso's statement came amid continued volatility in the Forex market, with FX liquidity improving most of the time.