After more than two weeks of consistent depreciation, the Naira experienced a slight comeback on Monday, appreciating by 0.95% against the US dollar in the parallel market. This recovery comes as demand for the greenback moderated, providing a temporary reprieve for Nigeria’s struggling currency.
During intra-day trading on Monday, the Naira traded at ₦1,575 per dollar, reflecting a ₦15 gain compared to the previous week’s rate of ₦1,590 in the parallel market.
Currency traders reported that demand pressures eased, bringing some stability to the market. Just last Friday, the Naira had fallen to a new low of ₦1,590, driven by a scarcity of dollars. According to market data, this level was first reached on February 16, 2024.
Analysts at Afrinvest Securities Limited attributed the recent depreciation to an imbalance between dollar demand and supply, which had led to renewed pressure on the currency.
In the official Nigerian Foreign Exchange Market (NFEM), the Naira appreciated by 1.96% on Friday, closing the week at ₦1,517.93 per dollar, marking a ₦29.88 gain from the previous day’s rate of ₦1,547.81.
Meanwhile, Nigeria’s external reserves saw a slight uptick, increasing by 5 basis points (bps) week-on-week to $38.4 billion as of March 12, 2025, according to data from the Central Bank of Nigeria (CBN).
While the recent appreciation offers some short-term relief, market analysts caution that sustained stability will depend on several factors, including foreign exchange liquidity and dollar supply, monetary policies by the Central Bank of Nigeria (CBN), economic reforms to boost investor confidence and global market dynamics affecting dollar strength.
As the market adjusts to these shifting conditions, all eyes remain on the CBN’s forex interventions and broader economic policies aimed at stabilizing the naira.
