Economy

Exchange rate appreciates by N63 to seven-month high

Published

7 hours ago

February 3, 2025

Nigeria’s exchange rate appreciated significantly in January 2025, gaining N63.72 against the dollar to close at N1,474.78 per dollar on January 31 at the Nigerian Foreign Exchange Market.

According to data from the FMDQ Securities Exchange Limited and the Central Bank of Nigeria, this increase of 4.14 per cent pushes the local currency to the highest level it has reached in seven months, with the last time the currency traded at a similar rate being June 11, 2024, when it stood at N1,473.88/$ in the official market.

The sharp increase has been attributed to policies implemented by the CBN, which have influenced market dynamics and contributed to the currency’s strengthening.

Authorised currency dealers quoted the dollar as high as N1,495.01/$ and as low as N1,447.50/$ at the NFEM.

The naira opened the year at N1,538.50/$ on January 2, 2025, and steadily gained value throughout the month.

By January 3, it had dipped slightly to N1,535.00 before fluctuating within a range that saw it hit N1,560/$ on January 16, marking its highest point for the month.

However, the currency embarked on a more sustained appreciation from the third week of January, closing at N1,531/$ on January 24 and further strengthening to N1,520/$ on January 28.

It continued its climb, settling at N1,506/$ on January 29 and N1,493/$ on January 30 before reaching N1,474.78/$ on the last trading day of the month of January.

The naira also appreciated against the US dollar in the parallel market on Friday, closing at N1,610/$, compared to N1,630/$ recorded on Thursday, representing a N20 increase within a day.

This latest movement reflects the impact of recent monetary and foreign exchange measures introduced by the CBN to stabilise the currency and improve market confidence.

The introduction of the Electronic Foreign Exchange Matching System in December 2024 has played a significant role in this development.

The platform, which operates through Bloomberg’s BMatch system, allows authorised dealers to place anonymous orders into a central limit order book, ensuring transparency and efficient price discovery in the foreign exchange market.

This system has helped reduce market distortions and provided the CBN with enhanced oversight capabilities, making it easier to manage fluctuations in the exchange rate.

Another crucial factor influencing the naira’s recent appreciation is the introduction of the Nigeria Foreign Exchange Code, launched on January 28, 2025.

“The FX Code marks a new era of compliance and accountability. It is not just a set of recommendations; this is an enforceable framework. Under CBN Act 2007 and BOFIA Act 2020, violations will be met with penalties and administrative actions,” CBN Governor Olayemi Cardoso said during the launch of the FX Code.

The FX Code establishes principles for ethical conduct, governance, execution, information sharing, risk management, and settlement processes among market participants.

By aligning Nigeria’s foreign exchange operations with global best practices, the initiative has strengthened investor confidence and contributed to the recent improvements in the currency’s performance.

At the end of 2024, the naira stood at N1,535.00 per dollar on December 31, reflecting the challenges that had persisted in the forex market.

However, the policy interventions introduced by the apex bank in early 2025 have helped stabilise the market, allowing the currency to make significant gains over the past month.

The improved transparency in the foreign exchange system has reduced speculative activities, ensuring that exchange rates better reflect actual market conditions.

However, while the local currency is improving, Nigeria’s foreign exchange reserves experienced a significant decline in January 2025, dropping by $1.11bn over the course of the month.

According to data from the CBN, the country’s reserves stood at $40.88bn on January 2, but by January 30, they had fallen to $39.77bn.

This represents a 2.72 per cent decrease within the one month.

The decline in reserves follows ongoing interventions by the CBN in the foreign exchange market, as well as external debt servicing obligations and capital outflows.

While the naira appreciated significantly within the same month, the reduction in reserves seems to suggest that the CBN may have deployed part of its FX stockpile to stabilise the local currency and manage liquidity in the official market.

At the start of January, reserves remained above the $40bn mark, recording $40.88bn on January 2 and fluctuating within that range for the first half of the month.

By January 10, reserves stood at $40.75bn, and they peaked at $40.96bn on January 6 before beginning a gradual decline.

By mid-month, reserves had dropped to $40.42bn on January 15, further sliding to $40.05bn by January 22.

The steepest declines occurred in the last week of January when reserves fell below $40bn for the first time in months, hitting $39.99bn on January 23 and $39.77bn by January 30.

With the FX reserves at a three-month low, the consistent drawdown indicates heightened FX demand and possible interventions by the monetary authorities to maintain exchange rate stability.

The current decline is similar to the significant drop recorded in April 2024, when reserves plunged by $2.16bn within 29 days.

At the time, Cardoso attributed the decline to debt servicing and other financial obligations rather than interventions to stabilise the naira.

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SEE Black Market Dollar To Naira Exchange Rate in Lagos and FCT today, 3rd February 2025

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91% of corporate loans performing, says CBN

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Economy

SEE Black Market Dollar To Naira Exchange Rate in Lagos and FCT today, 3rd February 2025

Published

40 minutes ago

February 3, 2025

Naijablitznews

The official naira black market exchange rate in Lagos and FCT, Abuja today including the Black Market rates, Bureau De Change (BDC), and CBN rates.

According to Bureau De Change (BDC) sources in the Ogba and Ikeja axis of Lagos state, the exchange rate for a dollar to naira at the Parallel Market (Black Market) is N1700 on Monday, February 3rd, 2024, players bought a dollar for N1685 and sold it for N1700.

Bureau De Change (BDC) sources in Gwarimpa and Gwagwalada in FCT buy a dollar for N1685 and sell it for N1700 on Friday, February 3rd, 2024.

Please note that the Central Bank of Nigeria (CBN) does not recognize the parallel market (black market), as it has directed individuals who want to engage in Forex to approach their respective banks.

Dollar to Naira Black Market Rate Lagos
Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Buying Rate N1685
Selling Rate N1700
Dollar to Naira Black Market Rate FCT, Abuja
Dollar to Naira (USD to NGN) CBN Rate Today
Buying Rate N1685
Selling Rate N1700
Please note that the rates you buy or sell forex may differ from what is captured in this article because prices vary from state to state across Nigeria.

Economy

91% of corporate loans performing, says CBN

Published

7 hours ago

February 3, 2025

Kayode Sanni-Arewa

About 91 per cent of loans obtained from banks by companies are performing, the Central Bank of Nigeria (CBN) has said.

In its latest credit conditions survey released at the weekend, the CBN indicated that about nine per cent of corporate loans are non-performing, four notches above the apex bank’s regulatory guidance of five per cent.

According to the report, corporate loan default stood at nine per cent in fourth quarter 2024. It stood at 6.2 per cent in third quarter, 2.8 per cent in second quarter and 4.5 per cent in the first quarter of last year.

The CBN outlined the factors contributing to corporate credit demand to include commercial real estate, balance sheet restructuring, inventory finance, capital investments, merger and acquisition.

The apex bank said there were increased credit availability for corporate borrowers, while secured lending to households dropped.

“The demand for credit across all lending types increased in fourth quarter of last year. The factors influencing the increase for secured and unsecured household loans were consumer loans from households and credit cards lending from households respectively while inventory finance was the major factor that influenced the change in demand for corporate lending,” CBN stated.

The apex bank also noted that the demand for credit increased for all lending types during the period.

However, demand for mortgage and re-mortgage from households decreased.

“The demand for credit across all lending types increased in fourth quarter of last year when compared to the previous quarter. The overall spreads on secured and unsecured lending rates to households relative to Monetary Policy Rate (MPR) widened.

“For corporate lending, all lending type spreads on loan relative to MPR also widened, except Other Financial Corporations (OFCs) which narrowed in the current quarter,” the report stated.

The Credit Conditions Survey (CCS) reports on secured and unsecured lending to Households, Private Non-Financial Corporations (PNFCs), Small Businesses and Other Financial Corporations (OFCs). The survey was based on lenders responses, to questions from the statistics department of the CBN.

To determine the aggregate results, each lender was assigned a score based on lender’s response. Lenders who report that credit conditions have changed “a lot” are assigned twice the score of those who report that conditions have changed “a little”. These scores were then weighted by lenders credit market shares.

The results were analyzed by calculating net percentage balances, such as the difference between the weighted balances of lenders reporting that demand was higher versus those reporting that demand was lower. The net percentage balances are scaled within the range plus or minus 100.

Economy

ALTON– Nigerians to pay more for calls, data as telcos implement new tariffs by March

Published

8 hours ago

February 3, 2025

Kayode Sanni-Arewa

The Association of Licenced Telecommunications Operators of Nigeria has announced that telecommunications companies will fully introduce new tariffs by March.

Gbenga Adebayo, chairman of ALTON, disclosed this while speaking to journalists at a forum with telecom executives. He said telcos are currently filing, reviewing, and obtaining regulatory approvals before implementing the new rates.

The tariff adjustment follows the Nigerian Communications Commission’s (NCC) approval of a 50 percent hike on January 20. Three days later, Wale Edun, Minister of Finance, confirmed that telecom tariffs would undergo periodic reviews.

Adebayo stated, “So we are now following what is called the regulatory requirement, regulatory steps of filing, review and obtaining approvals.

“As soon as those approvals come through, different players will introduce new rates as the time comes.

“I’ll say over next week, we start seeing some improvement in the prices.

“Over the next month, we should start seeing some total introduction in what the new rates will be like, but it’s important that we’ve come to a point where what has to be done has to be done for the sector to survive.”

Adebayo emphasized that the adjustment is necessary for the survival of the sector, arguing that telecom operators should not be expected to subsidize other industries.

“The other side of it is that the sector cannot be the subsidy for other sectors.

“So you can’t say because cost of garri and pepper and okro has gone up, we now have to subsidise people’s living by providing services that are sold at lower than cost. It’s a matter of time before we start seeing the negatives.

“I think it is important that we need to charge rates that are sustainable and we can’t stand as a subsidy for the problems of people in other sectors, which is not the problem caused by the operators.”

“Government cannot outsource that problem to their network operators to solve for the public.

“The government needs to provide adequate palliatives to help people live, and our services cannot be used for those palliatives,” he added.