Naira’s Surge Explained: CPPE Discusses Factors Behind N1535 Exchange Rate
The recent appreciation of the Nigerian Naira against the US Dollar, now trading at around N1535 per dollar, can be attributed to several factors, as explained by experts like the Centre for the Promotion of Private Enterprise (CPPE).
One key factor is the Central Bank of Nigeria’s interventions in the forex market, which have improved liquidity and reduced speculation.
This includes a series of policy measures that regulate the supply of foreign currency, such as curbing dollar hoarding and enhancing the availability of forex.
Additionally, the increase in interest rates has encouraged saving rather than spending, leading to reduced demand for foreign currency.
This change in consumer behavior, alongside the government’s attempts to minimize wasteful expenditures, has also contributed to the Naira’s stability.
However, experts caution that while the Naira’s rise is a positive development, its full impact on sectors like imports may take some time due to the usual delays in the import cycle.
The CPPE emphasizes that if these conditions remain stable, the benefits of the Naira’s appreciation could be more apparent in the coming months.