Exchange Rates Deteriorate Across Nigeria’s Forex Markets
Naira’s exchange rates deteriorated across Nigeria’s foreign exchange (FX) markets due to renewed pressures from increased demand for US dollars. The naira faced renewed pressure this week, slipping across both official and parallel markets amid rising demand for the U.S. dollar and constrained FX supply.
US dollar daybook logged showed FX jerked up above the supply levels, despite a fresh $50 million FX intervention by the Central Bank. At the official window, the naira weakened by 0.11% week-on-week to close at N1,530.26 per dollar, reflecting a thinning liquidity environment.
The parallel market mirrored this downtrend, with the naira depreciating by 0.97% to settle at an average of N1,545/$1—down from N1,530/$1 the previous week, Cowry Asset Limited said in a note.
The firm highlighted that the pullback erased part of the currency’s recent gains, even as the Central Bank of Nigeria (CBN) continued its interventions to defend the naira. “The rising gap between dollar demand and supply remains a core challenge, though recent reforms suggest a path toward greater currency stability in the near term”.
In the global commodity space, oil prices were poised for a marginal weekly gain after a temporary reprieve in trade tensions. Market jitters eased following the White House’s decision to delay its deadline on proposed sweeping tariffs, which many feared would dampen global demand.
Brent crude hovered near $70 per barrel, with added speculation stemming from U.S. President Trump’s anticipated “major” announcement on Russia, slated for early next week.
On the domestic front, Nigeria’s benchmark crude, Bonny Light, edged higher to $72.81 per barrel from last week’s $72.07. The steady price of oil and improved export performance helped lift Nigeria’s foreign reserves, which grew by 0.47% to close the week at $37.36 billion.
Meanwhile, OPEC’s latest 2025 World Oil Outlook painted a bullish long-term picture. The oil cartel raised its global demand forecast, projecting consumption to hit 122.9 million barrels per day by 2050—an increase of over 19 million b/d, with growth driven primarily by emerging markets in India, Africa, and the Middle East.
Looking ahead, analysts at Cowry Asset Limited said they expect a more stable outing for the naira in the coming week. With continued CBN intervention, FX reforms gaining traction, and steady oil export revenues, the groundwork is gradually being laid for currency recovery and improved market sentiment, the firm said. MTN Nigeria Hits N8.18trn, Analysts Positive on Earnings Outlook
