Trading activity in Nigeria’s foreign exchange market recorded a major increase in the week ended August 21, 2026, with total turnover rising by 146.12 per cent to $5.05bn, according to data from FMDQ Securities Exchange.
The latest figure represents an increase of $3,002.63m from the $2,054.89m recorded in the preceding week ended August 14, reflecting a significant expansion in market activity.
The sharp rise was largely driven by transactions in the foreign exchange spot market, which accounted for virtually all of the weekly increase.
Spot Market Drives Weekly Surge
FMDQ data showed that spot market turnover climbed by 155.02 per cent during the review week, rising by $3,044.52m to $5,008.52m from the $1,964.00m recorded a week earlier.
With the sharp increase in spot transactions, average daily spot turnover rose to $1,001.70m. The spot segment consequently expanded its share of total foreign exchange market activity to 99.03 per cent, compared with 95.58 per cent in the previous week.
The development points to significantly stronger demand and liquidity in immediate foreign exchange transactions, with market participants relying more heavily on the spot window during the period.
The surge in liquidity also comes against the backdrop of improving macroeconomic conditions, continued foreign portfolio inflows and stronger external reserve buffers.
Nigeria’s external reserves recently crossed the $52.5bn mark, representing their highest level in 17 years. The stronger reserve position provides additional support for the country’s external liquidity and has helped improve confidence in the foreign exchange market.
CBN Measures Support Market Activity
Market participation has also benefited from measures introduced by the Central Bank of Nigeria to improve transparency and efficiency in foreign exchange trading.
The CBN’s Electronic Foreign Exchange Matching System has been central to efforts to provide greater visibility in FX transactions and strengthen price discovery in the market.
At the same time, the apex bank has maintained a relatively tight monetary policy stance as part of its broader efforts to support exchange-rate stability, contain inflationary pressures and strengthen confidence in the naira.
The combination of improved market transparency, stronger external reserves and continued foreign investment inflows has contributed to a more liquid foreign exchange environment.
FX Derivatives Turnover Falls
While spot market activity surged, the derivatives segment recorded a contrasting performance during the week.
Turnover in FX derivatives declined by 46.09 per cent, falling from $90.89m in the previous week to $49.00m.
The entire decline was attributed to reduced activity in FX Forwards, which also fell by 46.09 per cent during the period.
As a result, average daily turnover in the derivatives segment dropped to $9.80m, while its contribution to total market turnover fell sharply to 0.97 per cent from 4.42 per cent recorded in the preceding week.
Market analysts attributed the decline in derivatives activity to the stronger availability of immediate liquidity in the spot market. With more liquidity accessible through spot transactions, market participants may have had less incentive to rely on forward contracts as a tool for managing currency exposure.
Overall Daily Turnover Rises Sharply
Despite the weakness in the derivatives segment, the broader foreign exchange market recorded substantial growth during the week.
Average daily turnover across all market segments rose to $1,011.50m, compared with $461.40m in the previous week.
The figures highlight the extent to which spot transactions drove activity during the review period, with the segment accounting for more than 99 per cent of total weekly turnover.
The strong performance further underscores the growing importance of liquidity, market transparency and investor confidence in shaping activity in Nigeria’s foreign exchange market as monetary authorities continue efforts to strengthen the stability and efficiency of the FX ecosystem.