The Nigerian naira ended the week slightly stronger in the official foreign exchange market, closing at ₦1,599.01 to the U.S. dollar on Friday, showing marginal gains over the previous day.
According to data published by Nairametrics, this movement came amid continued volatility during intra-day trading, where the exchange rate peaked at ₦1,603.50 and dropped to a low of ₦1,597.00 per dollar.
In contrast, the parallel market saw the naira weaken mildly. Traders at Wuse Zone 4 in Abuja reported a rate of ₦1,632/$1 on Friday—marking a ₦7 drop from Thursday’s ₦1,625/$1. Earlier in the week, it had fluctuated between ₦1,633/$1 and ₦1,625/$1.
Market analysts pointed to rising demand for dollars by importers and business operators as the key driver behind the depreciation seen in the informal market.
Official vs. Parallel Exchange Rate Trend (May 12–16, 2025)
| Date | Official Rate (₦/$1) | Parallel Rate (₦/$1) |
|---|---|---|
| Monday | ₦1,597.70 | ₦1,633 |
| Tuesday | ₦1,599.75 | ₦1,635 |
| Wednesday | ₦1,596.01 | ₦1,625 |
| Thursday | ₦1,599.99 | ₦1,625 |
| Friday | ₦1,599.01 | ₦1,632 |
Economic Indicators Offer Slight Relief
Nigeria’s inflation rate eased to 23.71% in April 2025, dropping from 24.23% in March. The 0.52-point decline, as reported by the National Bureau of Statistics, could indicate the beginning of a cooling trend in consumer prices.
External reserves also saw a rebound, gaining $364 million between April 30 and May 14. This brought the total to $38.298 billion—the first consistent gain recorded since January. Analysts attributed this improvement to stronger transparency measures and better liquidity flows in the official FX market.
“The naira closed the week showing early signs of gradual recovery, bolstered by ongoing policy measures from the CBN aimed at enhancing market stability and liquidity.”
Focus Turns to May MPC Meeting
Investors are closely watching the Central Bank of Nigeria’s Monetary Policy Committee meeting, set for May 19–20. The committee last held the Monetary Policy Rate at 27.50% and is now under pressure to balance currency support with inflation control.
What happens next will likely depend on sustained forex inflows, policy clarity, and efforts to boost confidence among market participants.
Article updated 3 weeks ago. Content is written and modified by multiple authors.
