The naira trade at N1,401.4 per dollar at the official section of the foreign exchange (FX) market on Tuesday.
Data from Nigeria’s official window, the Nigerian Foreign Exchange Market (NFEM), indicates that the value of the naira has dropped by 4.09 percent over the past three weeks from the N1,346.32/$ recorded on February 20.
According to the statistics, the naira was trading at N1,405.62/$, while the FX rate for the dollar crossed N1,400/$ on Monday.
The local currency was trading at N1,401.2 against the US dollar on January 27, the last time the exchange rate reached the N1,400 range.
The naira fell 0.70 percent to N1,440 per dollar at the parallel part of the FX market, from N1,430 per dollar on Monday.
The development coincides with continuing tensions between Israel, Iran, and the United States (US), which have caused unrest in a number of international markets.
Because of this, the price of crude oil increased to $100 per barrel on Monday, the highest since July 2022, before declining to $87 on Tuesday.
According to analysts, Nigeria’s foreign exchange market may be impacted by changes in the price of oil globally.
They forecast that the country’s trade balance will determine whether the naira appreciates or depreciates in relation to the dollar.
According to Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), Nigeria’s current account balance and foreign exchange liquidity are generally strengthened by rising oil prices.
“This could reduce short-term pressure on the naira and reinforce investor confidence,” he said.
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