Nigeria’s naira steadies as Chinese yuan swap deal and peer-to-peer forex trading reduce pressure on dollar demand.
Nigeria’s recent exchange rate stability is being linked to its currency swap deal with China and the rise of peer-to-peer (P2P) forex trading. The swap allows Chinese traders to accept naira for yuan, reducing dependence on the U.S. dollar for transactions.
Forex traders say P2P exchanges also cut pressure on the naira by letting individuals trade currencies directly without banks. “The Chinese are now collecting naira for yuan… these two factors are working right now,” said Aminu Gwadebe, president of the Association of Bureau De Change Operators of Nigeria.
Nigeria first signed the swap deal in 2018, renewed in 2024 for $2 billion. While it reduces dollar demand for trade with China—Nigeria’s largest partner—analysts caution its effect on the broader forex market remains limited, since most global transactions still rely on the U.S. dollar.
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