U.S Dollar Inflows into Nigerian FX Market Increase by 64%

U.S Dollar Inflows into Nigerian FX Market Increase by 64%

U.S dollar inflows through the Nigerian forex market (NFEM) increased by more than 64% as the Apex Bank stepped up intervention at the official window.

The naira faced pressures, but the Apex Bank’s quick and successive FX sales bolstered liquidity conditions in the currency market last week.

Foreign exchange inflows through the Nigerian Foreign Exchange Market (NFEM) increased significantly to US$841.10 million, Coronation Merchant Bank research subsidiary said in a note.

The total amount translates to 64.21% week on week surge compared with US$512.20 million in the previous week, merchant lender said in the note.

By breakdown, the CBN accounted for the largest share of inflows at 33.42% or US$281.10 million. This was followed by Nonbank Corporates (23.07%), Foreign Portfolio Investors (19.38%), Individuals (5.45%), while other sources contributed 2.01%.

At the same time, gross external reserve rose to US$44.6 supported by stronger inflows during the week. Analysts said they expect the exchange rate to remain within a similar band below the N1,500/US$1 level, supported by stable liquidity conditions and continued CBN interventions.

Last week, the Naira recorded a mixed performance across the official and parallel market. The official rate appreciated mildly by 0.69% w/w to close at N1,446.74/US$1.

In contrast, the parallel market rate weakened by 0.34% w/w to settle at N1,470.00/US$1. As a result, the spread between both markets expanded to N23.26/US$1, from the N8.28/US$1 in the previous week.

Crude oil prices saw modest gains last week, driven by a mix of supply restraint and ongoing geopolitical uncertainty. US rig activity fell to a four-year low, signalling potential constraints on future output, while hopes for a Fed rate cut supported expectations of stronger demand.

Meanwhile, market participants were closely watching the Russia-Ukraine peace talks and the upcoming OPEC+ meeting, which added an element of uncertainty and kept sentiment cautiously positive.

Despite rising US crude inventories, trades after the thanksgiving holiday amplified price movements, resulting in a fragile but noticeable uptick in benchmark prices.

As a result, Brent closed the week up 1.02% at US$63.20 per barrel, trimming its year-to-date decline to -15.33%, with a year-to-date average of US$68.65, 14.03% below the 2024 average of US$74.64.

Similarly, Bonny Light crude gained 3.13%, closing at US$66.29 per barrel, maintaining a premium of US$2.36 per barrel. Year-to-date, Bonny Light’s loss stands at 12.18%, with a 2025 average of US$71.54 per barrel, Coronation said. Ikeja Hotel Hits Highest Valuation in 52-Week, Gains 45%