Naira Continues to Gain Strength Against World Currencies, Exchanges for N1520 to Dollar

The Naira exhibited remarkable strength in the parallel market, concluding the week at N1,520/$1, surpassing the Central Bank of Nigeria (CBN) rate.

Throughout the week, the currency reached its zenith in the parallel market, closing at N1,520/$1, which is N14 more favorable than the official CBN rate of N1,534/$1 as of Thursday’s market close.

This trend signifies a persistent appreciation in the unofficial market, where the Naira ascended from N1,550/$1 on Tuesday to N1,530/$1 on Wednesday, advancing to N1,535/$1 on Thursday, and ultimately settling at N1,520/$1 on Friday.

Conversely, the official exchange market maintained relative stability yet remained less competitive. The Naira closed at N1,534/$1 on Thursday, marking a slight improvement from N1,537/$1 on Wednesday, and marginally below the N1,536/$1 rate on Tuesday.

Last week’s performance:

Last week, the Naira narrowed the divide between the official and parallel exchange markets, trading at N1,535 to the dollar in the parallel market, merely N1 less than the N1,536/$1 rate observed in the official market.

Data from the CBN website last week indicates the Naira concluded at N1,536/$1 on Thursday, reflecting a depreciation from N1,531/$1 on Wednesday.

Intra-day trading on Thursday exhibited the Naira’s highest trade at N1,538/$1 and lowest at N1,520/$1, according to CBN data released on Friday.

Foreign reserves reach $38.45 billion:

Nigeria’s foreign exchange reserves have ascended to $38.45 billion, up from last week’s $37.78 billion, representing a 1.77% week-on-week increase.

This development is part of ongoing initiatives aimed at stabilizing the Naira and enticing foreign investment.

Analysts suggest that the modest rise in reserves augurs well for the economy, fortifying the Central Bank’s capacity to defend the Naira, facilitate imports, and fulfill external obligations.

During a press briefing in Abuja on Tuesday, July 22, 2025, following the conclusion of the 301st Monetary Policy Committee (MPC) meeting, CBN Governor Olayemi Cardoso stated, “The MPC also notes the sustained stability in the foreign exchange market, accentuated by improved capital flows, earnings from increased crude oil production, rising non-oil exports, and significant investments.

“And very importantly, Nigerians are having greater confidence in their own currency,” he added.

He further remarked, “The foreign exchange market is functioning more effectively and seamlessly, encouraging inflows into that market.”

“Of course, reference is always made to Nigeria’s transition from the challenging situation where subsidies were prevalent,” he added.

He continued, “These measures, albeit painful, have engendered stability in the foreign exchange market. There is positivity in our trade surplus, and it has reinstated investor confidence.”

Key insights:

CBN announced the retention of the Monetary Policy Rate (MPR) at 27.5% during its 301st MPC meeting.

All twelve members of the MPC unanimously voted to uphold the MPR at 27.5%, indicating a cohesive stance among policymakers amid persistent inflationary pressures and exchange rate volatility.

Other pivotal decisions taken by the MPC include:

– Maintaining the asymmetric corridor around the MPR at +500/-100 basis points

– Preserving the Cash Reserve Ratio (CRR) at 50% for Deposit Money Banks (DMBs) and 16% for Merchant Banks

– Retaining the Liquidity Ratio at 30%