The Nigerian naira strengthened at the official foreign exchange market on Monday, marking a notable turnaround after recent losses, while it concurrently weakened in the parallel market.
Data from the Central Bank of Nigeria (CBN) indicated that the official exchange rate appreciated to N1,354.26 per U.S. dollar. This represents a gain of N11.93 against the dollar from the N1,366.19 rate recorded at the close of business on Friday, February 6. The appreciation signals the currency’s strongest performance in the official window since May 29, 2024, when it traded at N1,329.65 per dollar. This movement follows a slight depreciation last week Friday, which had ended several days of gains.
In contrast, the naira depreciated in the parallel market. Multiple Bureau de Change (BDC) operators in Abuja’s Wuse Zone 4 reported that the local currency sold for N1,455 per dollar on Monday, a drop of N5 from the N1,450 rate of the previous Friday.
The development occurs against the backdrop of Nigeria’s foreign exchange reserves, which stood at $46.91 billion as of February 5, according to the CBN. The reserves position has remained relatively stable in recent months.
The divergence between the official and parallel market rates underscores the persistent duality in Nigeria’s foreign exchange ecosystem. While the official window saw a significant appreciation, the parallel market reaction suggests ongoing pressure and a demand-supply gap that continues to influence street-level rates. The stability in foreign reserves provides a foundational buffer for the central bank’s interventions in the official market, though the gap to the parallel rate remains a key indicator of underlying market sentiment and access to foreign currency.
