Nigeria’s official exchange rate crashes to N1,600/$1 as Trump tariffs rattle global markets

Data from the Central Bank of Nigeria (CBN) shows the naira closed at N1,600/$1, marking a 1.9% depreciation compared to the N1,569/$1 recorded the previous day.

This is also the weakest level the naira has reached since December 4, 2024, when it closed at N1,608/$1. The exchange rate has now weakened by 3.9% in the first four days of April, after closing March at N1,537/$1.

According to data from the CBN, the exchange rate closed at N1,600/$1 on Friday, April 4th, marking a 1.9% depreciation from the previous day.

The NFEM rate, which represents the average exchange rate, closed at N1,567, also the weakest the naira has traded this year and since December 4, 2024.

The Central Bank recently released its net external reserve position, showing that after netting off liabilities, the external reserves stood at approximately $23 billion.

While most analysts who spoke to Naijaonpoint viewed this as a positive development, some expressed concern that the reserves were still not robust enough, given Nigeria’s continued dependence on portfolio inflows to shore up reserves.

Sources with knowledge of the new forwards being considered also suggest the terms are more favorable to Nigeria this time.

United States President Donald Trump recently imposed a global tariff on all U.S. trading partners, in what he dubbed “Liberation Day.”

The decision sent global markets into a tailspin, as foreign investors sold off assets over fears of heightened uncertainty and potential reciprocal tariffs. In response, China retaliated with a 34% tariff on all U.S. imports into the country.

While the tariffs are not expected to significantly affect Nigeria’s trade position with the U.S., the likely impact will be felt on the crude oil front. Nigeria relies heavily on crude oil to shore up its foreign currency earnings and thus prefers higher oil prices.

Naijaonpoint sees a drop in crude oil prices as the most consequential threat to exchange rate stability in the near term.