The naira weakened to N1,490 per dollar at the parallel market, pushing the exchange rate gap with the official market to its widest level in 11 months.
This is according to data from Nairametrics Research and the Central Bank of Nigeria’s (CBN) official market update for the third trading week of January 2026.
While the official market recorded a slight appreciation, trading remained under pressure amid growing demand for foreign exchange and limited supply.
The naira closed at N1,417.95 per dollar in the official market on Friday, appreciating slightly from N1,424.5 recorded a week earlier.
However, in Abuja’s parallel market, the currency depreciated to between N1,489 and N1,490, compared to N1,477 on January 9. This widened the official-parallel gap to N73 — the highest since February 2025.
What the data is saying
The marginal appreciation of the naira this week coincided with a modest improvement in Nigeria’s external reserve position.
- The CBN reported that Nigeria’s foreign exchange reserves closed the week at $45.8 billion, compared to $45.6 billion the previous week.
- The gradual reserve build-up has been attributed to inflows from oil exports and portfolio investments.
- On the official market, the naira appreciated slightly to N1,417.95 per dollar, from N1,424.5 recorded the week prior.
- Despite this, the naira remains under pressure due to strong forex demand across both market segments.
This shows that while external buffers are improving, the forex market remains strained by demand-side pressures.
Backstory
At the close of 2025, the exchange rate gap between the official and parallel markets widened significantly.
- The parallel market ended the year at about N1,470 per dollar, while the official market settled at N1,429 per dollar.
- This marked the widest disparity between the two markets since February 2025.
- On February 5, 2025, the official rate closed at N1,499 per dollar while the parallel market hit N1,605 per dollar.
- At some points later in the month, the official rate even traded weaker than the parallel market.
The return of a widening gap highlights ongoing instability in Nigeria’s FX pricing system.
Why this matters
The gap between Nigeria’s official and parallel market exchange rates is closely watched as an indicator of market stress.
- A widening spread suggests growing arbitrage opportunities between FX windows.
- It also points to increased demand in the BDC segment by those unable to access official FX.
- Prolonged gaps tend to pull the official rate closer to parallel market levels.
- The CBN has historically responded with direct interventions to close the gap.
This divergence influences expectations around future currency direction and policy responses.
What you should know
Nigeria’s foreign reserves have remained stable above $45 billion since January 2026, offering a cushion for FX market stability.
- The CBN publishes official rates that guide transactions in banks and licensed BDCs.
- These rates are closely monitored alongside parallel market rates by investors and businesses.
- Past interventions include direct forex supplies and anti-speculation measures.
- December 2025 inflation sharply eased to 15.15% after a data methodology update by the NBS.
These indicators are important for understanding the CBN’s capacity and strategies in managing exchange rate volatility.
