The naira extended its appreciation against the US dollar at the official foreign exchange market, closing at N1,418.26 on Wednesday, a gain of 80 kobo compared with the previous session’s rate of N1,419.06.
Data from the Central Bank of Nigeria showed that trading at the official window remained within a relatively narrow range, with intraday lows and highs of N1,414.00 and N1,426.00 per dollar, respectively.
Analysts said the steady movement suggests limited pressure on dollar supply, adding that ongoing interventions by monetary authorities are helping to bridge liquidity gaps in the market.
Anchoria Securities Limited noted that the naira is likely to continue trading in line with prevailing demand-and-supply dynamics, supported by a gradual improvement in Nigeria’s external reserves position.
In contrast, the local currency weakened in the parallel market, depreciating by 0.21% to trade around N1,467 per dollar. The divergence reflects mixed sentiment and differing liquidity conditions between the official and informal FX segments.
Nigeria’s external reserves climbed to $45.623 billion following fresh inflows from investors who participated in the Central Bank’s OMO bills auction earlier in the week. Market participants said the inflows provided short-term support for the naira and strengthened reserve buffers.
Analysts expect reserves to remain relatively stable in the near term, underpinned by stronger foreign portfolio investment inflows, improved oil revenue receipts, and sustained FX management by the CBN.
Foreign exchange market conditions in 2025 have shown signs of gradual stabilisation following a series of structural reforms aimed at improving transparency and liquidity. Increased activity at the official window and a narrowing spread with the parallel market have enhanced price discovery and bolstered investor confidence.
While the modest reserve buildup enhances the authorities’ ability to manage volatility, analysts caution that long-term sustainability will depend on consistent oil earnings and the expansion of non-oil foreign exchange inflows.
