Naira strengthens as FX turnover jumps 59.2%

The naira appreciated in the official foreign exchange (FX) market following a sharp 59.2 percent increase in turnover at the Nigerian Foreign Exchange Market (NFEM) window.

Data released by the Central Bank of Nigeria (CBN) showed the naira strengthened by 0.7 percent, with the dollar quoted at N1,357.34 on Wednesday, compared to N1,366.56 on Tuesday.

Market activity improved notably, with total deals rising to 287 on Tuesday, a 25 percent increase from 262 recorded on Monday. FX turnover climbed by 59.22 percent to $424.46 million, representing a $157.88 million increase from $266.58 million posted the previous day.

Activity in the interbank segment also strengthened. The number of deals rose by 62.6 percent to 161 on Wednesday from 99 on Tuesday, while turnover surged by 120.95 percent to $158.18 million, up from $71.59 million.

Despite the improved liquidity conditions, Nigeria’s external reserves continued their downward trend, declining to $48.33 billion as of May 5, 2026, according to data from the apex bank.

At the parallel market, the naira held steady, trading between N1,395 and N1,400 per dollar. This widened the gap between the official and parallel market rates to about N43 per dollar.

A report by the FMDA noted that the naira appreciated across both official and parallel segments in April, supported by improved FX liquidity. Total turnover at the Nigerian Foreign Exchange Market rose to $8.51 billion during the month.

The report added that exchange rate movements were driven more by global financial conditions and capital flows than oil price dynamics. Higher oil production in March, alongside increased portfolio inflows, also supported the currency.

Looking ahead, the FMDA warned that the naira could face mild pressure from maturing securities, particularly the large volume of Open Market Operations maturities exceeding N7 trillion. However, inflows from autonomous sources are expected to provide some cushion against potential volatility.