Naira Skids as Foreign Payments Eclipse Total Forex Supply
The naira worsened across the Nigerian foreign exchange markets on Tuesday, reflecting the negative impacts of increasing demand for international payments amidst tight supply.
The Nigeria Naira depreciated against the US dollar as demand pressure deepened despite the Central Bank of Nigeria (CBN) intervention and Foreign Portfolio Investors (FPIs) inflow.
The last lap of 2025 has witnessed a tremendous increase in foreign transaction payments and deal settlements funded by the Apex Bank.
In its daily FX update, the CBN reported that the official rate weakened to N1454 per dollar amidst continual intervention sales to strengthen the market supply.
The spot FX rate reached an intraday high of N1456.5000 per dollar, which was an actual improvement compared to the previous day’s quote.
The CBN official rate dipped by ₦2.52 per US dollar to close at ₦1,454.3805/$, having traded within a range of ₦1,456.50 and ₦1,450.25 per USD during the session.
In the parallel market, the exchange rate fell 1.50% at ₦1,485 per dollar as the authority reduces numbers of informal sector currency operators to 82.
External reserves maintained an uptrend, settling at $45.317 billion, boosted by inflow from crude oil receipts, remittances and other sources.
Oil prices edged lower on Tuesday after falling 2% in the previous session, with investors keeping a close eye on peace talks to end Russia’s war in Ukraine, concerns about ample supply and a looming decision on U.S. interest rates.
Brent crude shed 38 cents, or 61 bps, to $61.95 per barrel, while U.S. West Texas Intermediate (WTI) lost 63 cents, or 1.07%, to $58.25. In contrast, gold prices edged higher, as traders await the Federal Reserve’s policy meeting.
Federal Reserve’s two-day policy meeting and Chair Jerome Powell’s remarks for clues on future monetary policy. Spot gold increased by 0.47% to $4,208.91/oz, while U.S. gold futures rose by 0.49% to $4,238.25/oz.
Analysts expect cautious trading as markets brace for the Federal Reserve’s rate decision and its potential hawkish tone. Auction: Interest Rate on Nigerian Treasury Bills to Rise –Firm
