In the Nigerian Foreign Exchange Market (NFEM), the naira began the day at around ₦1,398.86 to the dollar, and by mid-morning on Monday, February 2, it had edged slightly stronger, trading at ₦1,396.88. The early trading session saw the exchange rate fluctuate within a narrow band, reaching a high of ₦1,398.86 and dipping to a low of ₦1,394.13. Analysts say this measured movement reflects the Central Bank of Nigeria’s continued efforts to clear verified FX backlogs, coupled with the growing impact of the Electronic Foreign Exchange Matching System (EFEMS), which has improved transparency and price discovery in the official window.
The stability witnessed in the official market has also been reflected in the parallel market, although rates there remain higher as expected. In major commercial cities including Lagos, Abuja, and Kano, Bureau De Change operators reported the dollar trading between ₦1,465 and ₦1,480. Traders in the informal sector noted that despite the usual surge in demand that comes with the start of a new month—driven by import payments and travel-related FX needs—price levels have stayed largely contained. Market participants attribute the calm to a decline in speculative hoarding, as the narrowing gap between official and parallel rates has reduced incentives for arbitrage and “rent-seeking” behaviour that has previously fuelled volatility.
A look at the opening rates shows the official market maintaining a disciplined tone, with the naira’s early movements suggesting a market that is both cautious and resilient. Meanwhile, supply in the parallel market appears sufficient to meet current retail demand, including small-scale business transactions and personal remittances.
Looking ahead, the outlook for the naira in February remains cautiously optimistic. With Nigeria’s external reserves steady and oil output showing gradual improvement, economists believe the currency is positioned to sustain its current defensive stance. However, market watchers will be closely monitoring the volume of trades in the official window over the coming days, as liquidity levels will be a key determinant of whether the current stability can be maintained through the month.