By Boluwatife Oshadiya | July 31, 2026
Key Points
- Naira closes at ₦1,366.73 per US dollar at the official market amid tighter FX liquidity
- Interbank FX turnover declines 4.2% to $58.42 million, while Nigeria’s external reserves edge lower
- Falling global oil prices add pressure on sentiment despite continued foreign exchange inflows
Main Story
The naira weakened marginally against the United States dollar at the Nigerian Foreign Exchange Market (NFEM) on Thursday as tighter foreign exchange liquidity weighed on the local currency.
According to market data, the naira closed at ₦1,366.73/$1, with transactions executed between ₦1,365 and ₦1,370 per dollar during the trading session.
Market participants attributed the mild depreciation to strong demand for foreign currency from banks acting on behalf of customers, despite continued inflows into the market. Dealers noted that available dollar liquidity remained insufficient to fully meet demand, putting pressure on the exchange rate.
Interbank FX turnover declined 4.2% to $58.42 million, down from $61.03 million recorded in the previous session. The number of completed transactions also fell to 71 deals, compared with 86 deals a day earlier.
Meanwhile, Nigeria’s external reserves declined slightly to $51.922 billion, from $51.938 billion, according to the latest figures published by the Central Bank of Nigeria (CBN).
The naira’s performance also coincided with weaker crude oil prices. Brent crude fell about 1.2% to around $87.05 per barrel, while West Texas Intermediate (WTI) crude slipped 0.55% to approximately $84.85 per barrel, as easing geopolitical tensions in the Middle East reduced concerns over potential supply disruptions.
The Issues
The latest movement comes as the foreign exchange market continues to rely on periodic interventions by the Central Bank of Nigeria to improve liquidity. Although recent foreign portfolio inflows have supported market activity, sustained demand for dollars from businesses and importers continues to test available supply, while fluctuations in global oil prices remain a key driver of Nigeria’s external earnings.
What’s Being Said
Market participants said demand for foreign exchange remained firm throughout the session, while available liquidity was unable to fully satisfy requests from financial institutions and their customers.
The Central Bank of Nigeria’s latest reserves data also showed that external reserves continued their gradual decline, reflecting ongoing pressures on the country’s foreign currency position.
What’s Next
- Investors will monitor the CBN’s next foreign exchange interventions for signs of improved market liquidity
- Developments in global crude oil prices will remain a key factor influencing Nigeria’s external reserves and FX inflows
- The market will continue to track foreign portfolio investment and interbank trading volumes for indications of near-term exchange rate direction
The Bottom Line: The naira remains relatively stable compared with earlier periods of heightened volatility, but persistent demand for US dollars and softer oil prices suggest liquidity conditions will remain a key determinant of short-term exchange rate movements.
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