The Nigerian naira experienced one of its biggest gains in nearly a year, closing at N1,515 to the dollar on Friday, a significant improvement from the N1,715 recorded on Thursday. This appreciation comes as the National Bureau of Statistics (NBS) reported a N5.81 trillion trade surplus for Nigeria in the third quarter of 2024.
According to parallel market traders, the naira has been steadily appreciating throughout the week, trading at N1,730/$ on Monday, N1,725/$ on Tuesday, and N1,695/$ on Wednesday. The closing rate on Friday represents a substantial strengthening of the national currency, falling below N1,600 for the first time in nearly six months.
Analysts attribute the naira’s gains to the Central Bank of Nigeria’s (CBN) new foreign exchange (FX) framework and the introduction of the Electronic Foreign Exchange Matching System (EFEMS). The automated trade-matching platform, backed by Bloomberg’s BMatch system, has enhanced transparency and operational efficiency in the FX market, leading to increased confidence among market participants.
CBN Governor Olayemi Cardoso, speaking at the 59th Bankers Annual Dinner, described EFEMS as a significant step towards exchange rate unification and market stability. The policy is expected to curb forex market distortions, eliminate speculative activities, and promote transparency.
The NBS report also highlighted Nigeria’s impressive trade performance in Q3 2024, with total merchandise trade standing at ₦35,160.44 billion. Exports accounted for 58.27% of total trade, valued at ₦20,486.39 trillion, while imports were valued at N14,674.05 trillion, representing 41.73% of total trade. Crude oil exports continued to dominate, accounting for 65.44% of total exports.