The naira rebounded in the official foreign exchange (FX) market this week, recovering from last week’s losses as Nigeria’s external reserves continued their steady growth, reinforcing investor confidence and improving liquidity conditions.
Data published by the Central Bank of Nigeria (CBN) showed that the naira appreciated by N10.74 week-on-week, with the dollar quoted at N1,370.19 on Friday at the Nigerian Foreign Exchange Market (NFEM), compared with N1,380.93 on Friday last week, representing a 0.78 percent gain.
In the parallel market, also known as the black market, the naira closed at N1,400 per dollar on Friday, weakening by N3 from the opening rate of N1,397.
Nigeria’s external reserves, which provide the CBN with the firepower to defend the naira and meet external obligations, maintained their upward trajectory, rising to $51.45 billion as of June 30, 2026. This represents an increase of $14.24 billion, or 38.27 percent, from $37.21 billion recorded in the corresponding period of 2025, according to data published on the CBN’s website.
Although NFEM data for Friday’s turnover and transactions were unavailable, market activity remained strong during the first four trading days of the week. The number of deals rose to 1,377, representing a 10.96 percent increase from 1,241 transactions recorded in the previous week.
Total turnover at the NFEM window averaged $543.32 million during the week, up by 24.30 percent from $437.09 million recorded a week earlier, reflecting stronger foreign exchange market activity.
Interbank market transactions also increased, with the number of deals rising by 16.29 percent week-on-week to 714 from 614. However, total interbank turnover declined by 43.30 percent to $70.43 million on Friday, compared with $124.22 million recorded in the previous week.
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In his personal statement at the last Monetary Policy Committee (MPC) meeting, Muhammad Sani Abdullahi said exchange rate pressures had remained contained, reflecting improved market liquidity, reduced speculative activities and adequate external buffers.
“Exchange rate pressures have remained contained, with relative stability in the foreign exchange market indicative of improved market liquidity, reduced speculative positioning and the presence of adequate external buffers. Sustaining sufficient foreign exchange market depth and liquidity will be critical to enhancing the market’s resilience and capacity to absorb potential external and domestic shocks,” he said.
Murtala Sabo Sagagi, another MPC member, said Nigeria’s external sector had remained resilient, supported by stronger reserve accumulation.
According to him, gross external reserves stood at $49.49 billion as of May 15, 2026, compared with $48.35 billion at the end of March 2026, providing import cover of about 9.04 months for goods and services.
“This strong reserve buffer continues to reinforce investor confidence and support exchange rate stability,” Sagagi said.
Read also: Why naira is at a three-month low despite rising dollar liquidity
Mustapha Akinkunmi, also an MPC member, attributed the improved stability in the foreign exchange market to Nigeria’s transparent and market-oriented exchange rate framework.
He noted that as of May 15, 2026, the naira traded at N1,371.04 per dollar in the official market, appreciating by more than N15 compared with the average exchange rate recorded in January 2026.
“This development reflects improved market confidence and the effectiveness of ongoing policy measures aimed at strengthening macroeconomic stability,” he said.
Akinkunmi further noted that external reserves stood at $49.49 billion as of May 15, 2026, compared with $30.26 billion in January 2026, representing the highest level in 11 years and providing import cover of approximately 9.68 months of goods and services.
