Friday, December 13, 2024

Naira Closes Week Strongly, Stabilizes at N1,600/$ in Official Market

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This week, the naira, which is Nigeria’s money, got a little stronger when people swapped it with the US dollar at the official money exchange market.

On Friday, the market data showed that you could get one US dollar for N1,600. This is better than on Thursday when one US dollar was N1,601.20 in the same market.

Olayemi Cardoso, who is a top leader at the Central Bank of Nigeria (CBN), said that people are starting to trust the naira more now, and the bank wants to keep the naira steady and strong.

He explained that people are trusting the naira because the bank is making smart decisions to make sure the money stays valuable.

Also, CBN announced that old N200, N500, and N1,000 notes will still be used as money until at least December 31, 2024, so people shouldn’t worry.

Afam Ogene, who works in Nigeria’s government and is part of the Labour Party, asked CBN if the old and new money notes can still be used the same way. Since the new notes came out, many Nigerians feel confused about which ones to use. The House of Representatives wants answers and has asked their team to talk to CBN and report back in 21 days.

“Is there any country that uses two kinds of the same money notes at the same time?” Ogene questioned, showing he doesn’t understand CBN’s plan. He stressed that the new notes were meant to replace the old ones, but having both is difficult for people in Nigeria.

U.S. Dollar Stays Strong Around the World

The US dollar has been getting stronger for four weeks now. People thought the American central bank, called the Federal Reserve, might change how much it costs to borrow money. But lately, the dollar’s rise slowed down.

  • The dollar index, which shows how strong the dollar is against other money, ended at 104.03. This week, it went up a lot but then went back down a little. Experts now think it will remain stable for some time.
  • One important report said that businesses in the U.S. are spending more money on new projects. It went up by 0.5% last month, which is higher than what experts thought.
  • A survey from the University of Michigan found that people felt slightly happier about the economy in October compared to September, and they also thought prices would not go up as fast as before.

Good news about the US economy makes people believe that the bank will not need to lower interest rates too much, keeping US money stable. Everyone is now looking forward to an important report next week about jobs in the US.

  • Also, the dollar is doing well because people think Donald Trump, a previous US President, might win the presidential race next month, which could change rules in ways that affect money positively.
  • People at the US central bank haven’t said much this week about changing interest rates, and they are waiting to see more data about jobs and prices before making decisions.
  • While Trump seems to be gaining support, the election race is very close, so it’s hard to tell who will win.

The uncertain situation reminds people of past elections where Trump’s win surprised many, and those betting in the market are preparing for any big changes if Trump wins, as it might affect tax, trade, and who can come to the US.

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