Naira Holds Steady at ₦1,329.16 Against US Dollar Amid Improved Reserves

The Nigerian naira has maintained its stability at ₦1,329.16 against the US dollar in the official market, according to data from the Central Bank of Nigeria (CBN). The parallel market rate is slightly higher, ranging from ₦1,365 to ₦1,390 per dollar.

The calm in the currency market can be attributed to several factors. Firstly, Nigeria's external reserves have reached a multi-year high of $54.86 billion on September 24, providing a bigger cushion for the central bank to intervene when necessary.

Secondly, liquidity has improved in the official window, making it easier for traders to find dollars at the formal rate and reducing demand for cash dollars on the street. This is reflected in the narrowing gap between the official and parallel market rates.

The CBN's decision to cut the benchmark interest rate from 26.5% to 23% has also contributed to the stability in the currency market, as a cheaper borrowing environment can boost businesses and reduce demand for foreign currencies.