The naira strengthened by 0.7 percent in the official foreign exchange market, trading at N1,357.34 to the dollar on Wednesday, up from N1,366.56 the previous day. This followed a 59.22 percent jump in turnover at the Nigerian Foreign Exchange Market (NFEM) window to $424.46 million on Tuesday, an increase of $157.88 million from $266.58 million on Monday. Total transactions rose to 287 deals on Tuesday, up 25 percent from 262 on Monday. The interbank segment saw more pronounced growth, with deals increasing by 62.6 percent to 161 on Wednesday from 99 on Tuesday, while turnover surged 120.95 percent to $158.18 million from $71.59 million. Despite the improved liquidity, Nigeria's external reserves declined to $48.33 billion as of May 5, 2026, according to Central Bank of Nigeria (CBN) data. At the parallel market, the naira remained stable, exchanging between N1,395 and N1,400 per dollar, widening the gap with the official rate to about N43. A report by the Financial Markets Dealers Association (FMDA) noted the naira appreciated in both official and parallel markets in April, supported by improved forex liquidity, with total monthly turnover reaching $8.51 billion. The FMDA attributed exchange rate movements more to global financial conditions and capital flows than oil prices, citing higher oil production in March and increased portfolio inflows as supportive factors. It warned of potential mild pressure on the naira from maturing securities, particularly over N7 trillion in Open Market Operations, though inflows from autonomous sources may cushion volatility.
💡 NaijaBuzz Take is AI-assisted editorial opinion, not established fact. Full disclaimer →
