The Centre for Promotion of Private Enterprise (CPPE) has explained that the Naira has recorded massive gains against the dollar in recent weeks due to improvements in the country’s external reserves and interventions by the Central Bank of Nigeria (CBN).
The Director of CPPE, Muda Yusuf, stated that the rise in Nigeria’s external reserves to over $40 billion has given the CBN more power to intervene in the market, stabilizing the currency.
“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.
His comments come as the Naira gained ₦127 to close at ₦1,535 per dollar on Friday last week compared to ₦1,660 against the dollar last week Monday.
Additionally, the introduction of the Electronic Foreign Exchange Matching System (EFEMS) has contributed to the Naira’s stability.
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