The Nigerian naira recorded gains against the US dollar last week, bolstered by reduced corporate demand for foreign exchange and sustained intervention by the Central Bank of Nigeria (CBN) in the FX market.
Closing Friday’s trading session at N1598.72 per dollar at the official window, the naira appreciated from its Monday opening rate of N1606.15, signalling a firming trend supported by improved liquidity conditions and subdued FX requests from large corporates.
According to AIICO Capital Limited, the exchange rate stabilisation was largely underpinned by decreased demand from businesses and marginal intervention from the apex bank, which sold approximately $40 million during the week to cushion market volatility.
Market observers noted that foreign portfolio inflows and offshore dollar supplies also played a role in easing pressure on the naira, even as the CBN reduced its direct involvement in daily FX sales. Nonetheless, Friday saw the CBN step in to curb slight imbalances.
Despite these gains, analysts caution that the broader outlook for the naira remains vulnerable to global economic shocks. Uncertainty surrounding oil prices, triggered by OPEC+ production increases and concerns over global demand, continues to pose risks to Nigeria’s external earnings and FX reserves.
Latest data from the FMDQ platform shows the CBN injected $2.61 billion into the FX market between March and April, a stark contrast to the $928.40 million net outflow recorded in the first two months of the year.
Meanwhile, Nigeria’s foreign reserves gained fresh traction, rising to $38.335 billion last week, following a decline in April when it dipped to an eight-month low of $37.80 billion due to increased FX demand and external debt repayments.
Cordros Capital Limited reported that the naira depreciated by an average of 3.52% in April, closing at N1,579.80 compared to March’s N1,524.27. So far in May, the local currency has fluctuated between N1,589 and N1,615 at the close of trading.
Elsewhere, oil prices posted modest gains on Friday, buoyed by easing U.S.–China trade tensions, though capped by expectations of higher supply from OPEC+ and Iran. Brent crude settled at $65.50 per barrel, while West Texas Intermediate (WTI) rose to $62.59.
On the other hand, gold prices tumbled nearly 10% from April’s record highs above $3,500 per ounce. Spot gold hovered around $3,180, marking its worst week in six months, despite long-term bullish projections.
