3 Major Reasons Why the Naira is Appreciating Against the Dollar

        The recent rise of the naira in the parallel market against the dollar has been traced to three possible factors. For the past seven days the naira had seen a major appreciation in its value against the dollar and other currencies

Nigeria's local currency a fortnight ago was very weak against the dollar, exchanging above N400 per dollar, the worst level it has ever gotten in history.

However, the naira has been appreciating recently and it all boils down to these three main reasons:

1. Government's stance on Devaluation

The Muhammadu Buhari government has refused to devalue the naira, despite calls for devaluation from several local and foreign bodies. The Naira staged a major comeback after President Buhari reiterated his stance against devaluation a week ago.

2. Dollar demand is easing

Another reason the naira is appreciating is because the demand for dollar in the country is easing up. Several organizations are starting to look inwards for raw materials and less people are buying dollars in panic. The rush for dollar has ebbed as traders now convinced there won't be a devaluation in the coming weeks. As a result those hoarding the currency are now selling.

3. BDCs are cooperating with the Central Bank of Nigeria:

It's not guaranteed the currency will appreciate back to its 197/$ 'CBN' rate in the coming weeks as negativity still persists. However, the general feeling is positive and the outlook seems fair as there are reports that the Bureau De Change operators have been complying with the financial directives of the apex bank in Nigeria.