Pressure came on the Naira in the different segments of the foreign exchange (FX) market on Tuesday, July 22, as its value weakened against the US Dollar at the close of transactions.
In the parallel market, the Nigerian Naira, after maintaining stability in the past few trading session, lost N2 against the greenback yesterday to sell for N1,537/$1 compared with the N1,535/$1 it was traded a day earlier.
In the Nigerian Autonomous Foreign Exchange Market (NAFEM) window, the local currency weakened against its American counterpart by N1.84 or 0.12 per cent to close at N1,535.48/$1 compared with the N1,533.64/$1 it was exchanged on Monday.
Similarly, against the Pound Sterling in the official market, the Nigerian currency tumbled by N3.94 during the session to trade at N2,070.88/£1 versus the previous day’s N2,066.94/£1 and lost N6.22 against the Euro to finish at N1,796.23/€1 versus the N1,790.01/€1 it was exchanged a day earlier.
The downward trend for the Naira came as interventions by the Central Bank of Nigeria (CBN) dropped, creating pressure that has overlooked reforms that boosted foreign investors’ confidence and sentiment.
Despite the recent trajectory, there are assertions that the Naira is still around the expected trading band.
Positive developments such as increased crude oil production and a rise in foreign portfolio investments, coupled with a slowdown in import-related outflows, will offer support long term.
According to Coronation Merchant Bank Research, potential risks remain on the horizon, including oil price volatility, external debt service obligations, and shifts in global interest rates, all of which could influence reserve dynamics and exchange rate pressures going forward.
Meanwhile, the CBN maintained interest rate levels at 27.50 per cent, despite recent moderation in inflation.
In the cryptocurrency market, there were positive movements as traders continued to weigh the impact of three important crypto bills, recently passed through the House in the US. One of the bills, the GENIUS Act, sets rules and regulations for stablecoin. The bill aims to make the stablecoin landscape safer and easier for users.
The Senate has voted in favor of the bills and they are now waiting for President Trump to sign off on them. Many experts think these new laws could bring big investors into crypto and make the ecosystem more stable.
Binance Coin (BNB) appreciated by 5.9 per cent to $799.06, Litecoin (LTC) added 3.6 per cent to sell at $119.94, Solana (SOL) jumped by 2.5 per cent to $201.89, Dogecoin (DOGE) rose by 2.4 per cent to $0.2659, Cardano (ADA) improved by 1.9 per cent to $0.8869, Bitcoin (BTC) jumped by 1.6 per cent to $118,784.77, Ethereum (ETH) increased by 1.2 per cent to $3,730.17, and Ripple (XRP) expanded by 0.2 per cent to $3.50, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.