Market News

The naira closed the mid-week trading session at N1,423/$ at the official foreign exchange market, extending a mixed performance that contrasts sharply with sustained weakness in the parallel market.

Data from the Central Bank of Nigeria (CBN) and Nairametrics Research shows that while the official market remains relatively stable, pressures persist outside the regulated window.

The gap between both FX windows has narrowed slightly but remains wide, demonstrating ongoing market reforms and structural constraints in Nigeria’s currency market.

What the data is saying 

At the Nigerian Foreign Exchange Market (NFEM), the naira traded at N1,420.5/$ on Monday, strengthened marginally to N1,420/$ on Tuesday, before depreciating to N1,423/$ on Wednesday.

• Last week, the currency opened at N1,425/$ on Monday and appreciated gradually to close at N1,417.95/$, reflecting intermittent gains at the official window.
• In the parallel market, the naira opened at N1,483/$ on Monday, maintained the same rate on Tuesday, and depreciated slightly to N1,486/$ on Wednesday.
• The gap between the official and parallel market rates stood at N63, down from N73 recorded last week, the widest margin since February 2025.
• On a year-to-date basis, the naira has started 2026 at N1,428/$, showing continued pressure despite episodes of relative stability at the official market.

The data indicates that while official rates show some convergence, the parallel market continues to experience intense foreign exchange demand.

More insights

The data shows that the current parallel-market rally is the worst since mid-December 2025, when the naira fell to N1,492/$ on 17 December 2025.

• Between 11 and 22 December 2025, the currency had sustained trading above the N1,480/$ psychological barrier, highlighting recurring stress in the informal FX market.
• The persistence of wide gaps underscores structural constraints that continue to shape the naira’s performance.
• Official market stability, meanwhile, reflects the Central Bank’s ongoing reforms and interventions to manage currency flows.

This shows that despite brief episodes of official market strength, structural pressures continue to dominate parallel market trading.

What you should know 

Global currency developments provide additional context for Nigeria’s FX dynamics. The U.S. dollar held gains against major currencies after President Donald Trump withdrew threats to impose tariffs on several European NATO countries.

• Trump cited a framework deal with NATO over Greenland as the basis for abandoning tariff plans, easing investor concerns after earlier threats had triggered broad selloffs in U.S. assets.
• The dollar was steady at $1.1685 per euro and flat at 0.7953 Swiss franc, while the Australian dollar rose to a 15-month high following stronger employment data and improved risk sentiment.
• Sustained improvement in the local currency will depend on stronger foreign exchange inflows, improved investor confidence, and reduced reliance on the parallel market.

Earlier this week, the naira slipped marginally at the official foreign exchange market, closing at N1,420.5/$ on Monday, as global dollar sentiment softened amid renewed concerns over U.S. economic and geopolitical risks.