The naira depreciated sharply in the official foreign exchange market following the U.S. imposition of a 14% tariff on Nigerian exports, raising concerns over lower foreign exchange inflows. The surge in dollar demand by market participants outpaced supply, putting pressure on the local currency.
As a result, the naira lost N21.28 or 1.39%, closing at N1,552.53 per dollar in the official market, according to spot FX data from the FMDQ platform. Transactions at the official window fluctuated between N1,535 and N1,570 on Thursday. Meanwhile, in the parallel market, the naira traded at N1,550 per dollar, with minimal demand pressures. This led to a narrowing of the spread between the official and parallel markets to 0.16% from 1.22%.
Oil prices also saw a significant drop, marking their steepest decline since 2022, following OPEC+’s unexpected decision to increase output after U.S. President Donald Trump announced sweeping new tariffs. Brent crude settled at $70.14 per barrel, down 6.42%, while WTI crude fell 6.64% to $66.95 per barrel.
Gold prices initially dropped over 2% from a record high but pared losses as broader market sell-offs affected traders. Spot gold fell 0.85% to $3,106.99 per ounce after hitting a record $3,167.57 earlier in the session.
On April 2, President Trump announced a 10% baseline tariff on all U.S. imports, alongside a set of reciprocal tariffs targeting 60 nations, including Nigeria. The 14% tariff on Nigerian exports is the second highest in West Africa, following Côte d’Ivoire’s 24% rate.
The new tariffs are expected to impact Nigeria’s export earnings, particularly oil exports, which could affect external reserves and foreign exchange liquidity, analysts warned.
