The Central Bank of Nigeria (CBN) has executed a $50 million intervention in the foreign exchange market in an effort to cushion the naira from renewed pressures sparked by heightened demand for US dollars, especially for offshore payments
The intervention was aimed at improving market liquidity and easing the sudden spike in dollar demand that disrupted the local currency’s recent rally. Analysts noted that the renewed demand came after the reactivation of naira debit cards for international transactions, which has significantly increased pressure on FX resources.
According to sources familiar with the matter, the apex bank channeled the intervention funds through licensed dealer banks to mitigate the strain on the naira and stabilize market conditions. As a result, the exchange rate remained within a tight range during the trading sessions, although concerns linger over the sustainability of these efforts.
Market analysts at Anchoria Asset Management forecast that the naira will likely trade within a band of ₦1,515 to ₦1,535 per dollar in the upcoming week. This projection is underpinned by the recent FX liquidity boost, the CBN’s dollar sales, and foreign participation in last week’s Open Market Operations (OMO) auction, which helped absorb some of the excess demand.
“These developments have supported confidence in the market, keeping volatility contained and signalling the effectiveness of policy interventions so far,” Anchoria noted in a briefing.
Despite the relative calm, the firm warned that mild exchange rate pressure could resurface as the month progresses, especially from corporate remittance requests and offshore bids. Still, the overall market sentiment remains cautiously optimistic, assuming the CBN maintains its current pace of intervention and liquidity enhancement strategies.
The firm added that further naira stability could be supported by increased FX inflows from exporters and continued policy clarity from monetary authorities. “We expect the naira to hold steady in the near term, though risks remain if demand outpaces supply,” Anchoria concluded.
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