Nigeria’s currency, the Naira, closed the past trading week on a marginally weaker note at the Nigerian Foreign Exchange Market, depreciating by 0.14 per cent week-on-week to settle at ₦1,532.34 to the US dollar.
Naijaonpoint reports that despite kicking off the week strong at a four-month high of ₦1,518.88/$, the local currency lost ground midweek, sliding to ₦1,530.25/$, then to ₦1,533.11/$ before ending at ₦1,532.34/$ on Friday.
Trading data from the Nigerian Foreign Exchange Market (NFEM) showed the highest rate at which the Naira exchanged during the week was ₦1,538/$, with the lowest being ₦1,515/$.
At the parallel market, the Naira traded within a band of ₦1,535.00/$ and ₦1,544.00/$, reflecting slight variations in the unofficial segment.
Market analysts say the mixed trading performance reflects persistent supply-demand imbalances in the FX market.
However, they credit the Central Bank of Nigeria’s interventions and improved liquidity as key factors providing temporary stability.
In its weekly market roundup, Cowry Assets Management Limited noted that while the Naira appreciated by 0.06 per cent week-on-week at the parallel market to close at ₦1,544.00/$, it ended weaker in the official window.
“The divergent movements reflect ongoing supply-demand imbalances and the evolving FX liquidity landscape,” the report read.
Cowry Assets, however, maintained a positive outlook, stating that improved oil output and elevated crude prices could drive higher dollar inflows, which in turn may support the continued accretion of Nigeria’s foreign reserves.
“The positive oil earnings outlook, combined with steady capital inflows, should offer continued support for the naira and enhance near-term FX market stability,” the firm added.
Meanwhile, new data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) showed that average daily crude oil production, excluding condensates, rose by 3.6 per cent to 1.51 million barrels per day in June 2025, up from 1.45 mbpd in May.
The increase marks the first time in five months that Nigeria has met its OPEC quota, signalling gains in operational efficiency and improved security at key oil-producing assets.
These improvements are expected to boost FX inflows into the country, further supporting the Central Bank’s efforts to stabilise the currency.
CBN Dollar Sales, Reserve Accretion Provide Some Cushion
AIICO Capital Limited also reported that the Central Bank of Nigeria (CBN) had intervened in the FX market last week through strategic dollar sales early and late in the week.
“Dollar sales helped maintain relative stability. The Naira closed at ₦1,532.34/$, down 13.6 basis points week-on-week. Reserves rose by $422 million to $37.85 billion as of Thursday, from $37.43 billion the previous week,” AIICO Capital stated in its report.
As the Monetary Policy Committee (MPC) begins its meeting today (Monday), analysts remain divided on the path forward for interest rates.
While some analysts advocate a modest rate cut—citing cooling inflation, improving FX conditions, and growing investor confidence—others caution that easing monetary policy too soon could undermine recent gains.
“Premature easing could undo all the gains of FX reforms and decelerating inflation, especially with food supply shocks and global risks still present,” the PUNCH quoted one analyst as warning.
Comercio Partners, in its commentary, said traders are holding back ahead of the MPC’s communique.
“For now, traders are positioning around the edges, but the real signal will come from the tone of the communique,” the firm stated.
With improved oil earnings, better FX inflows, and steady central bank support, market watchers believe the Naira is likely to remain within its current range in the short term, pending the outcome of the MPC meeting and global economic developments.