Naira at 2017 best as foreign reserves surpass 2016 high

The naira is currently at its best point since August 2016, while the nation’s foreign exchange reserves is at the highest point since the fourth quarter of 2015.

The local currency on Thursday appreciated to 390 per dollar, while the foreign reserves rose to $30.348 billion — its highest point since October 2015.

Over the past few weeks, the Central Bank of Nigeria (CBN) has taken a number of policy actions which were woven around stemming the liquidity challenge facing the country’s forex market.

After the Organisation of Petroleum Exporting Countries (OPEC) reached a deal to cut crude oil production in December, oil prices rose to a stable point above $50 per barrel on the global market.

In Nigeria, the federal government sought peace deals with militants Niger Delta, raising Nigeria’s production levels to 2.1 million barrels in February 2017.

This rise in production levels coupled with rise in prices led to a surge in Nigeria’s oil revenue, which began to plunge mid-2014.

Over the last month, the CBN has pumped about $2 billion into the foreign exchange market, in a bid to ensure convergence of all segments of the market.

With the naira trading around 380, 385 per dollar at the parallel market, and the pound and euro going for 490, 420 respectively, the CBN is closer to its goal than it has been at anytime in the last seven months.