Naira Strengthens Against British Pound to N1,788/£

The Nigerian Naira has strengthened against the British Pound Sterling, trading at N1,788/£, breaking below the significant resistance level of N1,800/£. This appreciation is attributed to robust fundamentals within the Nigerian economy, including aggressive interest rate hikes implemented by the Central Bank of Nigeria (CBN) and the promotion of high-yield instruments like T-Bills and PMAs.

These measures have increased institutional investment and bank holdings of Naira-denominated assets, reducing the demand for foreign currencies. Additionally, the inflow of foreign capital, driven by attractive domestic yields and enhanced market confidence, has improved the supply of foreign currencies such as the US dollar and British pound.

The growth in Nigeria’s gross external reserves, supported by stable oil production and rising global oil prices, allows the CBN to intervene in the market effectively. The article also notes that a contraction in the UK economy and changes in fiscal policies could further weaken the pound, aiding the Naira's recovery.