The naira ended the trading week weaker at the official foreign exchange market, closing at N1,421.9 per dollar as domestic supply constraints continued to outweigh supportive global dollar conditions.
Data from the Central Bank of Nigeria (CBN) and Naijaonpoint research show that the local currency recorded marginal losses during the week despite a softer U.S. dollar globally.
The performance highlights ongoing distortions in Nigeria’s foreign exchange market, with pressure evident across both the official and parallel segments.
The naira’s week-long performance at the official market reflects mild but persistent depreciation amid thin FX liquidity.
CBN data shows that although the currency avoided sharp swings, it failed to sustain gains made earlier in the week.
In the parallel market, the naira depreciated slightly to N1,491/$ on Friday from N1,490/$ the previous day, with Naijaonpoint research data showing weekly trading within a range of N1,483 to N1,491 per dollar, widening the gap between both markets to N70/$.
Speaking to Naijaonpoint, Dayo Omole, a currency trading expert based in Lagos, explained the situation.
“Nigeria has restrictions on foreign currency access and a limited dollar supply, so the naira may not strengthen as much in the parallel market. Sometimes, the parallel market rate can even move differently due to supply and demand pressures that are unrelated to the dollar’s global value.”
He added, “When the dollar falls globally, but Nigeria continues to struggle with foreign currency supply, the official and parallel market rates for the naira-dollar exchange can diverge further. This means the gap between the official naira value and the street rate can widen.”
Nigeria’s foreign exchange market has remained under strain following years of FX controls, multiple exchange rates, and limited dollar inflows.
Although recent reforms by the CBN aim to improve transparency and market efficiency, structural challenges continue to affect price discovery.
While the CBN has made progress with reforms intended to unify rates and restore investor confidence, the pace of improvement has been slower than market expectations.
Nigeria’s external buffers and broader macroeconomic outlook provide context for the naira’s recent performance.
These indicators suggest short-term support for currency management, even as liquidity constraints persist.