Market News

The naira on Tuesday surged to a record high of N1,372.91 to the dollar in the official foreign exchange (FX) market, without intervention from the Central Bank of Nigeria (CBN), reflecting a shift towards a more market-driven currency framework. In recent weeks, the apex bank has not contributed to dollar inflows in the market.

Data from the CBN showed the naira gained N17.45, appreciating by 1.3 per cent from Monday’s closing rate of N1,390.36 at the Nigerian Foreign Exchange Market (NFEM). Intraday trading saw the dollar dip to as low as N1,360 before closing at N1,367 per dollar.

At the parallel, or black, market, the naira remained steady at N1,450 per dollar, leaving a gap of N77.09 between the official and unofficial rates.

Foreign portfolio inflows into Nigeria were dominated by fixed-income investors, with bonds accounting for nearly half of total inflows during the period. Data from Coronation Securities Limited showed foreign portfolio investment in fixed income stood at $0.31 billion, representing 48.24 per cent of total inflows, underscoring sustained offshore appetite for high-yield naira assets amid improved market liquidity.

Equity inflows were modest at $0.01 billion, or 1.16 per cent, while foreign direct investment amounted to $0.03 billion, or 4.72 per cent. Other international investments contributed $0.02 billion, or about 2.97 per cent, reflecting limited long-term capital commitments compared with short-tenor flows.

On the domestic front, exporters and importers were the largest non-official FX suppliers, providing $0.14 billion, or 21.67 per cent of total inflows. Individuals accounted for 4.35 per cent, while non-bank corporates contributed 16.29 per cent through inter-company transfers, investment proceeds and remittances. There were no inflows from the CBN, underscoring the ongoing shift towards a market-driven FX system.

Nigeria’s external reserves, which provide the CBN with the capacity to support the naira, have continued to rise, reaching $46.59 billion as of 2 February 2026, according to CBN data.

Analysts at Rhodium Capital Limited said the naira extended its gains at the NFEM, closing at N1,372.91 per dollar, supported by strengthening reserves and improved FX supply conditions.

“With the US dollar showing near-term weakness, liquidity has improved further, enhancing supply visibility and supporting stability in the domestic market,” the firm said.

They added that the parallel market also recorded gains, narrowing the spread between official and informal rates.

“This convergence points to improved FX availability across market segments and a more balanced demand-supply dynamic, reinforcing near-term stability. We expect the naira to remain steady at current levels as the CBN manages its activities to keep the currency stable,” Rhodium Capital said.