Nigerian Naira Rallies as Foreign Investors Keep FX Supply Flowing
The naira rose against the US dollar at the official window on Monday after an FX report indicated that foreign portfolio investors continue to keep FX supply flowing into the Nigerian market.
According to a daily FX update obtained from the Central Bank of Nigeria, the local unit appreciated to N1360.1415 per greenback, from N1,365.6856 opening rate during the trading session.
Reflecting the absence of significant forex demand pressure, spot FX rates hovered between N1358.5000 and N1364.2500 per US dollar transaction during the trading session.
The market saw mixed trading activities of financial institutions acting as market makers at the Nigerian foreign exchange market (NFEM) window.
Interbank FX turnover came lower from the previous record, though the number of FX traded increased sharply on Monday.
The CBN data showed that interbank FX turnover declined to $213.845 million, about 46% below the $393.477 million reported at the close of the trading session on Friday.
This suggests the NFEM window recorded reduced demand from high-ticket FX customers or requisitioners, reflected in the lower interbank FX turnover posted by the authority.
The number of FX traded at the interbank market increased to 182 from 102 on Friday. Last week, the naira strengthened in the official market, rising to N1,365.69/US$1 from N1,368.22/US$1 the previous week.
In the parallel market, however, the currency depreciated to N1,420 to the dollar from N1,405 the previous week, reflecting persistent demand pressures.
Nigeria’s gross external reserves edged higher by 0.21% to US$52.03 billion from US$51.92 billion the previous week, helped by the fact that the CBN did not intervene in the foreign exchange market to support liquidity and moderate exchange rate volatility.
Total foreign exchange inflows for the week amounted to US$0.83 billion, with Foreign Portfolio Investors (FPIs) contributing the highest share at US$0.40 billion.
The amount accounted for 48.11% of total FX inflow in the currency market, followed by exporters at US$0.27 billion (32.47%), non-bank corporates at US$0.12 billion (14.97%), and individuals at US$0.02 billion (2.6%), Coronation Merchant Bank research subsidiary said in a report.
Other corporates at US$0.00 billion (1.03%), foreign direct investors contributed 0.78% of the FX inflows, and the CBN did not support with an FX injection.
Analysts said they expect the naira to remain broadly stable in the near term, supported by the CBN’s interventions where necessary and the country’s strong external buffer position, which should help contain exchange rate volatility. Nigeria’s Domestic Economy Expanded by 3.87% in 2025 – CBN
