The Nigerian naira extended its recent appreciation trend in the official foreign exchange market, climbing to N1,540 per dollar this week, an N11 gain from last Thursday’s closing rate of N1,551. This marks a cumulative appreciation of N47 since May 29, signaling renewed support for the currency through ongoing interventions by the Central Bank of Nigeria (CBN).
Data from the CBN confirmed the improved exchange rate, reinforcing a sense of cautious optimism in the official Nigerian Foreign Exchange Market (NFEM). Meanwhile, in the parallel market, the naira also strengthened slightly, appreciating to N1,600 per dollar from N1,605 the previous week.
Despite this dual progress, the gap between official and parallel market rates widened modestly to N60 per dollar from N54 the day before. Such disparities continue to reflect underlying pressures in the foreign exchange system, including demand management and liquidity dynamics.
Market analysts at Afrinvest West Africa Limited observed that the naira's performance remains mixed across segments. In their latest update, they noted the currency gained 0.7% month-on-month (m/m) at the official NAFEM window to close at N1,586.15 per dollar. Conversely, it weakened by 1.2% m/m in the parallel market, ending at N1,615.00 per dollar.
Looking ahead, Afrinvest projects a similar pattern to persist in the coming month, with continued CBN interventions likely to stabilize the official market, even as fluctuations persist in less-regulated segments.
The CBN has, in recent months, stepped up its efforts to manage exchange rate volatility through policy adjustments, increased supply of foreign currency, and tightened oversight on market practices. These measures are part of broader reforms aimed at boosting investor confidence, curbing speculative activity, and improving liquidity in the forex market.
While the recent appreciation offers some respite, analysts caution that sustaining the momentum will require consistent policy coordination, improved foreign capital inflows, and a favorable macroeconomic environment.