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Nigeria’s naira rose for a seventh day to a two-month high against the dollar on Tuesday amid higher oil prices and as investor concerns over US trade tariffs eased.
The unit gained 0.7% to 1,539 per dollar at 3:05 p.m. in Lagos, its strongest level since early April as oil prices rose to $67.50 per barrel and US-China trade talks in London entered a second day.
The naira rally “reflects a recent resumption of portfolio inflows, periodic foreign exchange sales by oil exporters and improved confidence as the market readjusts to relatively softer oil prices,” said Samir Gadio, head of Africa strategy at Standard Chartered Plc.
Nigeria’s currency slipped sharply after US President Donald Trump’s trade war sapped emerging-market sentiment and the price of oil, which is the main source of the country’s foreign exchange earnings.
But it has been steadily recovering since the initial shock wore off and if sentiment continues to temper, it could rally to around 1,500 per dollar this year, said Ayodeji Dawodu, an analyst at BancTrust & Co. in London.
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