CBN Spot FX Rate Dips Slowly as External Reserves Cross $38bn
The Central Bank of Nigeria (CBN) naira official exchange rate slid against the US dollar at the foreign exchange market amidst the country’s rising external reserves. FX data update from the CBN showed that the exchange rate depreciated to N1535.61 per dollar on Wednesday as the authority slowed down FX intervention sales.
At the parallel market, the local currency spot exchange rate closed at N1536 per greenback, leaving less than N1 as FX spread, thus discouraging speculative activities. The gross balance in Nigeria’s foreign reserves crossed $38 billion this week, supported by inflows from various external sources and reduced FX interventions.
Updated data from the CBN revealed that gross external reserves climbed to $38.366 billion on Tuesday amidst twists in the global commodity market. Though Nigeria’s oil production output has increased but prices have been fluctuating due to external issues out of the OPEC+ group’s control.
Oil prices remained below Nigeria’s 2025 budget benchmark, and the country rarely met production targets to achieve an optimal spending plan. The market anticipates FX inflows into the currency market to ease in the absence of open market operations by the Central Bank.
Last week, foreign exchange inflows during the week rose significantly to US$1.31 billion, up from US$750 million in the prior week, Coronation Research said in its market update.
Foreign investors accounted for the bulk of these inflows at 62.50%, marking the ninth consecutive week of their dominance in market participation and underscoring continued interest in Nigerian fixed income instruments.
Non-bank corporates contributed 14.08%, while exporters accounted for 12.76%. The CBN contributed 9.86%, while other corporates and individuals made marginal contributions of 0.33% and 0.34%, respectively. #CBN Spot FX Rate Dips Slowly as External Reserves Cross $38bn Naira Drops Value Against Dollar as FX Demand Rises
