Naira Closed at N1,500 per US dollar, FX Spread Falls
The naira settled at N1500.15 per US dollar in the official market amidst sustained FX intervention. In the parallel market, the exchange rate fell by 33 bps, settling at N1505, reducing FX gap to N5 per greenback.
The improved dollar liquidity helped alleviate pressure on FX demand. Market activity remained strong, with trades executed within the $/₦1,495.00 to $/₦1,505.00 range.
Oil prices declined, heading for their first monthly loss since November, as markets reacted to a tense Oval Office exchange between the U.S. and Ukrainian presidents, upcoming U.S. tariffs, and Iraq’s decision to resume oil exports from Kurdistan.
Brent crude futures, expiring that day, fell 86 cents to $73.18 per barrel, while WTI dropped 59 cents to $69.76.
Gold prices slid over 1% as the dollar remained strong after U.S. inflation data met expectations, suggesting the Federal Reserve may be cautious on rate cuts. Spot gold dropped 1% to $2,846.19 an ounce, marking a 3.1% weekly decline.
Analysts expect FX liquidity to remain robust as a more efficient market and improved market confidence continue to support inflows from autonomous sources.
In February, the naira fell by 1.69% in the official market but rose by 7.33% in the parallel market, bringing its year-to-date gain to 2.48% and 9.67% in the official and parallel markets, respectively.
Due to sustained FX intervention, gross external reserves declined to $39.10 billion, while Brent crude oil prices traded lower at $75.02 per barrel. After months of turbulence, the naira has shown signs of stability, settling around ₦1,500/$ after falling to ₦1,900/$ at its weakest.
“While optimists view this as a sign that CBN’s policy interventions are working, skeptics argue that the currency’s long-term strength is far from restored,” TrustBanc Financial Group Limited said in a note.
“A major challenge remains speculative hoarding, which has long fuelled naira volatility. With speculators, hedgers, and policymakers locked in a battle, many are watching for signs of weakness that could trigger another wave of depreciation.
“So far, CBN’s tighter liquidity controls, improved dollar inflows, and stronger reserves have helped ease pressure on the naira. However, sustaining this momentum will require more than intervention—it demands fundamental structural reforms to ensure lasting FX market stability,” TrustBanc said. #Naira Closed at N1,500 per US dollar, FX Spread Falls Yield on Nigerian Treasury Bills Falls ahead of Rebase Data
