The naira experienced mixed performance against the US dollar across foreign exchange markets, as authorities renewed efforts to stabilize the local currency. The spot rate touched a low of ₦1,535 per dollar.
December saw aggressive intervention by monetary authorities, with daily FX auctions spanning four consecutive weeks to support the naira. On the first trading day of 2025, the exchange rate held steady, reflecting a subdued FX market.
According to FMDQ’s spot data via Bloomberg BMatch, the exchange rate closed at ₦1,538.23 per US dollar. Meanwhile, in the parallel market, the naira strengthened to ₦1,650 per dollar, gaining ₦5, as FX demand subsided.
In late December, the naira appreciated to ₦1,538 following $107 million in weekly FX auction sales by the Central Bank of Nigeria (CBN). These auctions, aimed at curbing speculative activities and year-end demand pressures, underscored the CBN’s resolve to stabilize the currency.
The CBN ramped up interventions in November and December, selling an average of $400 million monthly to authorized dealer banks. This injection improved liquidity, keeping the spot rate below ₦1,600 per dollar in December. The naira fluctuated within the ₦1,520–₦1,550 range during the month, ultimately appreciating by 13 basis points to close at ₦1,535 per dollar.
Despite these interventions, the parallel market saw the exchange rate dip to ₦1,650 per dollar, fueled by demand for invisible transactions. The pressure persisted even as Bureau de Change operators were permitted to access $25,000 from local banks at official rates with a 1% FX spread cap.
Divergent 2025 Outlooks from Analysts
CardinalStone Partners expressed optimism about naira stability in 2025, citing factors such as the introduction of the EFEMS platform, increased foreign portfolio inflows, enhanced access to dollar-denominated debt, rising FX reserves, and a positive current account balance. The firm estimated the naira’s fair value at approximately ₦1,720.88 per dollar.
In contrast, Afrinvest Limited projected a weighted average exchange rate of ₦1,804 per dollar in 2025, reflecting a less optimistic outlook.
Oil and Gold Markets Update
Oil prices remained steady as Nigeria announced plans to boost production in 2025, counterbalancing Chinese manufacturing growth. Brent crude closed at $73.92 per barrel, while WTI stood at $70.95.
Gold prices saw a significant annual rise of over 26%, the largest increase since 2010, driven by demand for safe-haven assets and reduced central bank interest rates. Analysts warned that market sentiment might turn cautious depending on policy changes under a potential second Trump administration. Gold traded at $2,612.04 per ounce on Tuesday.
Nigeria’s foreign reserves grew this week, with the gross reserve level reaching $40.884 billion.
