The Central Bank of Nigeria, CBN’s, high interest rate regime and foreign exchange policy have whetted the appetite of Foreign Portfolio Investors, FPIs, as inflows amounting to N696.88 billion came into the stock market in nine months of 2024, 9M’24.
This represents a huge 170.1 percent growth from N258 billion in the same period of 2023, 9M’23.
Vanguard’s findings show that the foreign investors’ return to the Nigeria’s stock market became more intense in the first quarter of this year as the CBN launched aggressive interest rate regime ramping up Monetary Policy Rate, MPR, by 450 basis points to 27.25% between February and September this year.
The MPR is the minimum benchmark rate for investment portfolios in both capital and money markets.
Meanwhile, domestic investors committed N3.271 trillion to the stock market in the 9M’24, showing a 33.3% increase from N2.454 trillion in 9M’23.
Commenting on the FPI, analysts at Afrinvest Securities Limited, a Lagos-based investment firm, stated the CBN’s tough stance on inflation with constant hike in monetary rate resonated well with foreign investors.
