The naira continued its bullish momentum, firming up by 1.04 per cent against the U.S. dollar at the official market, closing at ₦1,494.03/USD on Thursday.
This appreciation reflects a sustained wave of foreign exchange liquidity, fueled by the Central Bank of Nigeria’s (CBN) non-renewal of dollar swaps and increased participation of banks in forex sales to Bureau de Change (BDC) operators.
At the parallel market, the naira surged to ₦1,514/USD on Wednesday, marking an ₦11 (0.72%) gain from the previous day’s ₦1,525/USD.
Meanwhile, the official rate remained stable at ₦1,510/USD, keeping the divergence between the two markets at a narrow ₦4 margin—a significant contraction from previous disparities.
The tightening spread is widely attributed to CBN’s intensified forex interventions and the effectiveness of its revised policy framework, which now allows BDCs to access forex directly from authorized dealers.
In the money market, liquidity conditions showed improvement as the Nigerian Interbank Offered Rate (NIBOR) remained mixed.
The overnight rate declined by 0.17 per cent to 32.75 per cent, reflecting improved banking sector liquidity.
Similarly, the Open Repo Rate (OPR) dropped by 0.04 per cent to 32.25 per cent, and the Overnight Lending Rate fell to 32.67 per cent.
The Nigerian Treasury Bills (NTBs) market sustained its bullish sentiment, with increased demand driving yields lower across the board.
The average yield on NTBs declined by 1.75 per cent to 20.21 per cent, spurred by strong in – vestor interest in short- and long-term maturities. The secondary market for Federal Government bonds remained bullish, with the average yield declining by 0.13 per cent to 19.79 per cent.
Long-term instruments saw the highest gains, notably the JAN-2042 bond, which shed 90 basis points.However, Nigeria’s sovereign Eurobonds witnessed a modest uptick, with yields rising by 0.04 per cent to 9.04 per cent, reflecting cautious optimism among foreign investors.
Meanwhile, the Central Bank of Nigeria (CBN) has left all monetary policy rates (MPR) unchanged on Wednesday.
At the end of the 299th MPC meeting held on February 19 and 20, 2025, the committee voted to hold the MPR at 27.5 per cent; retain the asymmetric corridor at +500/-100 around the MPR; retain the CRR of Deposit Money banks at 50 per cent; retain the CRR of Merchant Banks at 16 per cent; and hold the liquidity ratio constant at 30.00 per cent.
