The British pound sterling has surged to a four-month high against the US dollar, trading at N1,964/£1 in the parallel market, nearing the dreaded N2,000/£1 mark. This rise follows the UK economy’s 0.4 per cent growth in May, as reported by the Office for National Statistics.
Reacting to the development, the Central Bank of Nigeria (CBN) has called for calm, assuring that the worst days for the naira are over. CBN Governor Olayemi Cardoso emphasized that recent improvements in Nigeria’s foreign exchange management have restored confidence in the naira, despite its current depreciation in the parallel market.
The pound sterling’s strength has caught the attention of Nigerian businesses and individuals planning to travel to the UK. The naira’s pullback coincides with Nigeria’s foreign reserves reaching $35.05 billion as of July 8, 2024, the highest under President Tinubu’s administration.
In parallel market trading, the dollar stood at N1,550/$1, while the euro was at N1,677/€1. Governor Cardoso, speaking at the CEO Forum 2024 organized by Business Day Media, reassured that the CBN is committed to market transparency and economic stability, addressing illicit flows and FX backlogs.
Experts note that the CBN’s statements aim to calm market fears and highlight its efforts to stabilize the economy. However, they warn that the naira’s depreciation has led to increased price volatility and exchange rate disparities.
