The naira ended the week on a stronger note, appreciating slightly against the U.S. dollar to close at N1,599.01/$1 in the official foreign exchange market on Friday, according to data from the Central Bank of Nigeria (CBN).
This marks a marginal improvement from Thursday’s closing rate of N1,599.99/$1.
Intra-day trading on Friday revealed continued volatility, with the exchange rate reaching a high of N1,603.50/$1 and a low of N1,597.00/$1, reflecting both market fluctuations and growing resilience.
Throughout the week, the naira demonstrated relative stability:
- Monday – N1,597.70/$1
- Tuesday – N1,599.75/$1
- Wednesday – N1,596.01/$1
- Thursday – N1,599.99/$1
Parallel Market: Mild Depreciation Persists
However, in the parallel market, the naira experienced mild depreciation. Bureau de change operators at Wuse Zone 4, Abuja, reported the local currency traded at N1,632/$1 on Friday, a slight drop from N1,625/$1 recorded on Thursday.
In the parallel market, the naira started the week on Monday at N1633/$1 and continued on Tuesday at N1635/$1 and N1625/$1 on Wednesday.
The parallel market rate, according to Nairametrics data, was N1628/$1 on Friday from N1635/$1 on Thursday
Analysts attributed Thursday’s dip in value to a temporary surge in dollar demand from importers and other market participants.
Despite these fluctuations, 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.
Inflation Eases Slightly, Offering Economic Relief
In a positive economic development, Nigeria’s headline inflation rate eased slightly to 23.71% in April 2025, down from 24.23% in March, according to the latest data from the National Bureau of Statistics (NBS).
The 0.52 percentage point decline offers a glimmer of hope amid persistent economic challenges and the rising cost of living.
External Reserves Log First Sustained Gain in 2025
Further bolstering investor sentiment, Nigeria’s external reserves recorded their first sustained rebound of the year. Between April 30 and May 14, reserves rose by $364 million, climbing from $37.934 billion to $38.298 billion—a 0.96% increase.
This marks the first consistent upward trend since reserves last peaked at $40.92 billion on January 6, 2025. Analysts link the rebound to the CBN’s intensified push for foreign exchange market liberalization and improved transparency and liquidity, which appear to be gradually restoring investor confidence.
Eyes on Upcoming MPC Meeting
The naira’s trajectory will depend on consistent forex inflows, sustained investor confidence, and broader macroeconomic stability.
All eyes are now on the Monetary Policy Committee (MPC) meeting scheduled for May 19–20, where a fresh decision on the country’s monetary policy stance is expected. At its last meeting in February, the MPC maintained the Monetary Policy Rate (MPR) at 27.50%.
