Naira Strengthens Slightly Against Dollar as FX Turnover Surges in Nigerian Foreign Exchange Market

The Nigerian naira recorded a modest gain against the US dollar on Wednesday, supported by a notable rise in foreign exchange market activity. According to data from the Nigerian Foreign Exchange Market (NFEM), increased interbank trading helped boost liquidity and stabilize currency movements.

The Central Bank of Nigeria reported that the naira appreciated slightly by 0.09% to close at N1,379.46 per dollar, improving from N1,380.71 recorded the previous day. During intraday trading, the currency fluctuated between a high of N1,386 and a low of N1,365, reflecting active market interventions and dollar injections.

Market activity also strengthened significantly, with interbank FX turnover rising sharply to $249.9 million across 180 transactions. This surge signals improved liquidity conditions and suggests growing confidence among market participants, even as the currency continues to adjust to broader economic pressures.

Despite the official market gains, the parallel market rate remained relatively steady at around N1,395 per dollar. This indicates that while official market liquidity is improving, exchange rate gaps between markets persist, though they appear to be narrowing slightly.

Analysts note that the naira’s current movement reflects a “price discovery equilibrium,” where buyers and sellers are finding a more stable trading range above the N1,300 level. While the appreciation is marginal, the increase in FX turnover suggests that the market is becoming more active and better balanced, even amid cautious sentiment.

source: punch