Nigeria’s foreign exchange utilisation surged to $16.2bn in the first quarter of 2026, marking a 74 per cent increase compared with the same period in 2025, as improved dollar liquidity and greater naira stability encouraged more businesses and market participants to access the formal FX market.
According to the latest Central Bank of Nigeria (CBN) Quarterly Statistical Bulletin, invisible transactions were the biggest driver of the increase, rising sharply to $11.4bn from $4.5bn a year earlier. The category accounted for about 70 per cent of total FX utilisation during the quarter, with the financial services sector leading demand at $9bn, representing a 117 per cent year-on-year increase.
Business services also recorded a significant rise, with FX utilisation climbing to $1.2bn from $223.6m in Q1 2025. Meanwhile, foreign exchange used for merchandise imports remained largely stable, increasing marginally by 0.2 per cent to $4.9bn. Industrial companies, however, went in the opposite direction, with their FX utilisation falling by 20 per cent to $1.8bn during the period.
Demand for manufactured and transport products also increased, with FX utilisation for manufactured products rising to $1.1bn from $477.9m, while transport-related demand more than doubled to $295m from $142.8m. The increase was partly linked to higher import costs, global supply-chain pressures and rising prices of key inputs and raw materials following the US-Iran conflict.
The stronger FX activity points to improving liquidity conditions in Nigeria’s foreign exchange market, supported by stronger external reserves and increased dollar availability. Market confidence has also benefited from relative naira stability. Emerging markets analyst Ike Ibeabuchi said the rise was a positive sign that improved liquidity was encouraging businesses to return to the formal FX market, but warned that sustaining the trend would depend on the CBN maintaining adequate dollar supply and ensuring exchange-rate stability is backed by stronger economic activity.
source: punch
