The Nigerian Naira closed January 2025 at N1, 475/$1, marking its strongest performance since May 2024.
The Nigerian currency was officially exchanged for N1, 485 to a dollar in May 2024, the strongest until January 31, 2025.
This represents a significant gain from its closing rate of N1, 535/$1 on December 31, 2024, at the Nigerian Autonomous Foreign Exchange Market (NAFEM), indicating a N60 gain or a 3.91% increase month-on-month.
Throughout the month of January, Naira exchanged for around N1,560 and N1,506 to the dollar, except for the last two days of the month when it exchanged for N1,493 to the dollar on January 30th before further gaining to N1,475 on the final day.
Year on year, the Naira exchanged at N1, 482.5 to a dollar at the end of January 2024, marking an approximately 0.506% increase, according to Naijaonpoint research.
While the Naira’s modest gain in the parallel market is a positive sign, analysts caution that fluctuations remain likely due to external factors such as oil prices, remittance inflows, and investor sentiment toward Nigeria’s economy.
The foreign exchange market continues to experience volatility, and further interventions from the Central Bank of Nigeria (CBN) may be necessary to ensure sustained stability.
The CBN has been implementing several forex interventions and policy measures aimed at stabilizing the Naira, including tightening regulations on Bureau De Change operators and increasing dollar liquidity in the official market.
“The FX Code marks a new era of compliance and accountability. It is not just a set of recommendations; this is an enforceable framework. Under CBN Act 2007 and BOFIA Act 2020, violations will be met with penalties and administrative actions,” Cardoso said.
The circular, addressed to all BDC operators and stakeholders in the financial services industry, underscores the CBN’s commitment to fostering stability, transparency, and efficiency in the foreign exchange market.
This waiver is part of the CBN’s broader strategy to support the ongoing transition to the new BDC regulatory structure, following the release of the “Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria, 2024.”