The Nigerian currency continued its downward movement for the sixth consecutive trading session, pressured by persistent foreign exchange liquidity shortages in the official market window.
The gradual depreciation trend reflects ongoing supply constraints in the FX market and underscores the influence of regulatory positioning on currency stability.
Market participants attribute the continued weakness largely to the decision by the Central Bank of Nigeria to suspend aggressive foreign exchange interventions aimed at stabilising the naira.
While foreign portfolio investors, exporters, and non-bank corporates remain active contributors to FX inflows, analysts note that the apex bank has reduced direct dollar injections into the system.
Financial market analysts suggest that monetary authorities appear comfortable with a controlled and gradual depreciation, especially following a period of rapid gains in the local currency. This approach, they argue, is intended to discourage speculative inflows and mitigate risks of sudden capital flight.
The apex regulator has reportedly shown a preference for allowing measured appreciation or depreciation within a defined band, while also intermittently purchasing US dollars to moderate supply levels in the official window.
Data from midweek trading indicated that the naira traded within the N1,351 to N1,361 range during intraday activity. Official figures released by the Central Bank showed that the currency depreciated by 0.05 percent to close at N1,356.11 per dollar at the Nigerian foreign exchange market.
In the parallel market, the naira also weakened, trading at N1,365 per dollar, signalling renewed pressure across both the formal FX window and the informal segment.
The sustained softness of the naira highlights the delicate balance policymakers face between exchange rate management, liquidity control, and investor confidence in Africa’s largest economy.
