The Nigerian naira came under renewed pressure on Thursday, weakening to N1,355 per dollar in the foreign exchange market as external reserves dipped to $48.48 billion. Data from the Central Bank of Nigeria showed the currency slipped from N1,348.1/$ recorded a day earlier, extending a gradual downward trend that has unsettled traders and businesses alike.
Intraday figures revealed the naira traded between N1,350/$ and N1,355.8/$, with an average rate of N1,354.19/$ across 46 interbank deals. Compared to the previous week’s close of N1,341.01/$, the steady depreciation reflects persistent demand for foreign currency and limited supply within the market. At the same time, Nigeria’s external reserves edged lower from $48.54 billion earlier in the week, signaling reduced room for sustained intervention.
Market watchers say the pressure is not purely domestic. Rising geopolitical tensions have strengthened the U.S. dollar, drawing investors toward safer assets and away from emerging market currencies like the naira. Concerns over stalled negotiations involving the United States and Iran, alongside tensions in the Strait of Hormuz, have pushed oil prices and the dollar higher, leaving currencies such as the euro, pound, and yen on the back foot.
Other emerging market currencies, including the Philippine peso, Malaysian ringgit, and Indian rupee, have also recorded losses, highlighting a broader global trend. For Nigeria, however, the impact is amplified by structural FX constraints, with demand continuing to outpace supply despite ongoing policy adjustments.
Despite the decline in reserves, CBN Governor Olayemi Cardoso has urged calm, noting that short-term fluctuations should not be overinterpreted. He maintained that the apex bank remains focused on long-term stability, projecting that external reserves could rise to $51 billion by the end of 2026 as part of broader efforts to strengthen Nigeria’s macroeconomic position.
source: nairametrics