The naira recorded its third consecutive day of decline on Wednesday, closing at ₦1,473.29 per dollar at the official Nigerian Foreign Exchange Market, according to data released by the Central Bank of Nigeria (CBN).
From the start of the week, the local currency has struggled to maintain stability against the U.S. dollar. It began trading on Monday at ₦1,457.51/$, weakened slightly to ₦1,463.23/$ on Tuesday, and further depreciated by ₦10.06 or 0.69 per cent on Wednesday.
At the parallel market, however, the naira showed mild resilience. After closing at ₦1,500/$ on Tuesday, it appreciated marginally to ₦1,488/$ on Wednesday, according to figures from CardinalStone.
Financial analysts at Cowry Assets Management Limited attributed the naira’s decline to a diminished appetite for the local currency and weaker dollar inflows. The latest dip follows a brief period of strength last week when the naira reached a 10-month high of ₦1,455.17/$, its strongest level since December 2024.
The current depreciation trend runs contrary to expectations from market observers who had anticipated relative stability following CBN’s intervention measures and increased foreign inflows.
In its latest weekly report, Cowry Assets Management cautioned that the naira’s recent gains could be undermined by rising import demand or weaker dollar inflows. The firm noted that “oil prices may remain under pressure due to higher supply, but any rebound in global demand could offer some support to Nigeria’s external earnings, underpinning optimism for FX market stability.”
Despite the currency’s decline, Nigeria’s external reserves continued their steady rise, increasing to $42.63 billion as of Monday, up from $42.59 billion on Friday.
Meanwhile, CBN Governor Olayemi Cardoso, speaking at the G24 media briefing on the sidelines of the IMF/World Bank Annual Meetings in Washington, maintained that recent reforms have made the naira “more competitive.”
“We were able to create resilience and buffers against potential shocks. Those who follow the Nigerian economy are fairly comfortable,” Cardoso said, emphasizing that the naira’s strength ultimately depends on domestic productivity.
“Nigeria is completely restructuring its economy, and a competitive currency is helping drive that transformation,” he added.
The latest market trends suggest that while the naira remains vulnerable to external pressures and market sentiment, policymakers are banking on structural reforms and improved production to sustain long-term stability.