Naira stuck at N2,200/£ as British pound faces correction
Despite the Sterling’s correction phase due to worries about the UK economy, the Naira was weak against the pound.
The United Kingdom claims that the Developing Countries Trading Scheme (DCTS) will continue to allow duty-free access to 99 percent of Nigerian goods.
The goal of this action is to support Nigeria’s economic growth and improve bilateral trade relations. It streamlines export procedures and reduces taxes on thousands of products, making it easier for Nigerian businesses to enter the UK market. The largest Nigerian diaspora community outside of Africa is based in the United Kingdom.
Nigeria is praised for its bold economic reforms by the United Kingdom, which says they are essential for unlocking sustainable growth and improving the business environment for global partnerships.
Dr. Montgomery, the UK High Commissioner to Nigeria, commended the Nigerian government’s focus on reforms as a key priority aligned with the UK’s economic growth agenda.
He also supported the May 2025 NDU and its conclusion that the naira has stabilized, as noted by the World Bank, emphasizing that a stable economy boosts investment.
“There’s an increase in foreign exchange reserves, which reduces investors’ risk in Nigeria. There has been improved government revenue collection, not through taxes, thanks to tax administration reforms,” Montgomery added. He noted that both countries are positioning for greater economic cooperation based on reciprocal reforms and resilience, with the UK-Nigeria trade relationship already valued at £7.2 billion.
British Pound takes a slide amid concerns about Britain’s finances
British Prime Minister Keir Starmer’s office quickly offered Finance Minister Rachel Reeves full support to help calm investor concerns about Britain’s finances, which caused sterling to weaken after a sharp decline in the previous session.
Concerns over Britain’s finances resurfaced on Wednesday after Reeves’ emotional appearance in parliament, one day after the government backed down on welfare reforms, leading to a nearly 1 percent fall in the pound and a sharp drop in British government bonds.
Britain’s top finance official, Rachel Reeves, appeared visibly upset in Parliament on Wednesday when Prime Minister Keir Starmer declined to promise she would stay in her role, sparking increasing speculation about her future.
Wednesday’s discussion followed a heated debate over government proposals to change the social welfare system.
The government won a vote on its legislation on Tuesday, but despite several concessions that critics said had ruined the bill, 49 of its lawmakers rebelled. Much of the £5 billion ($6.8 billion) the chancellor had aimed to save was lost due to those concessions, raising concerns about the implications for the economy and Britain’s budget.
- The dollar fluctuated on Thursday after a trade agreement between the United States and Vietnam boosted optimism about future deals ahead of a July 9 tariff deadline.
- The euro remained steady at $1.1806, near the September 2021 peak it reached earlier this week, while the pound last traded at $1.3647, slightly higher during Asian hours.
- The yen strengthened slightly to 143.56 against the dollar.
- The dollar index, which measures the U.S. currency’s strength against six major global currencies, was at 96.7, still close to the 3.5-year lows it has been near this week.
The index is expected to decline 0.5 percent this week. Investors will focus on the United States ahead of the July 4 holiday, as the Labor Department prepares to release its comprehensive employment report for June on Thursday.
This follows data showing that private payrolls declined in June for the first time in over two years. If recession worries take hold, what was once seen as ‘bad news’, softer data that led the Fed to cut, may now be viewed as bad news.
President Donald Trump announced that Vietnam had reached a trade agreement with the United States before the July 9 tariff deadline, influencing other markets.
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