The naira faced renewed pressure against the US dollar on Wednesday, with transactions in the Nigerian Foreign Exchange Market reaching as high as ₦1,349.50 per dollar, according to Central Bank of Nigeria data reported by Legit News. The official closing rate was ₦1,345.7983 per dollar, a slight improvement on the ₦1,346.9348 recorded in the prior session. That marginal gain of roughly ₦1.14 came even as the currency traded within a range of ₦1,346 to ₦1,349.50 during the session, as demand from importers and businesses for foreign currency to settle international payments outpaced available supply.
Why it matters
The movement matters because it tests how durable the naira's recent recovery really is. The currency had held relatively steady after the apex bank stepped in to boost dollar liquidity, and the latest session suggests that support is being met with persistent underlying demand for dollars. For Nigerian businesses that rely on imported goods, swings of this kind make pricing decisions harder and leave replacement costs uncertain. Importers, manufacturers and ordinary consumers all have a stake in whether incoming dollar flows can keep the currency on an even keel.
Trading thins as demand holds firm
Activity in the interbank foreign exchange market slowed noticeably. Total turnover fell 15.15% to $100.929 million on Wednesday, down from $118.957 million the previous session, according to CBN figures cited by Legit News. The number of completed transactions also dropped, to 97 from 117 on Tuesday. The lighter participation points to a market where dollar demand for import bills, corporate obligations and other cross-border payments has not eased, even as banks scaled back their trading volumes.
Legit News reports that profit-taking by foreign portfolio investors added to the fluctuations in dollar availability. The CBN had previously injected about $1 billion into the foreign exchange market to ease liquidity shortages and steady the currency, a move that helped produce a stretch of relative calm before this week's volatility.
Reserves fall for a fifth straight day
The country's external buffers continued to shrink. Gross foreign reserves stood at $55.149 billion, down from a recent high of $55.264 billion, according to CBN data cited by Market Forces Africa and reported by Legit News. It was the fifth consecutive day of decline. Even so, expectations of further foreign currency inflows, particularly from crude oil earnings, could offer the naira some support in the sessions ahead.
Abroad, the US Dollar Index slipped 0.43% to about 101.40, reflecting broader softness in the American currency against major peers. That backdrop did little to change the picture at home, where the upper end of the naira's trading range underlined the pressure the currency is still absorbing.
The coming sessions will show whether oil-related inflows and the CBN's liquidity measures can hold the line, or whether dollar demand keeps pushing the naira toward the top of its recent range.
