FX Spot transactions drive Nigeria’s weekly FX turnover 46% higher to $2.39 billion

Nigeria’s foreign exchange market recorded a sharp rebound in the week ended July 17, 2026, with total turnover rising to $2.386 billion as a surge in spot transactions more than offset a steep decline in derivatives trading.

This is according to the latest weekly FX market turnover report released by FMDQ Exchange, which showed that total turnover across the FX Spot and Derivatives markets increased by 46.27%, or $754.67 million, from $1.631 billion recorded in the previous week.

The strong recovery was driven entirely by activity in the spot market, underscoring growing demand for immediate foreign exchange settlement, while appetite for forward contracts weakened considerably during the review period.

The market recorded an average daily turnover of $477.16 million, up from $326.22 million in the preceding week, reflecting stronger liquidity across the foreign exchange market.

What the data is saying:

A breakdown of trading activity shows that the FX Spot market overwhelmingly dominated transactions during the week, accounting for virtually all market turnover.

• FX Spot transactions climbed to $2.371 billion, representing 99.39% of total market turnover, compared with $1.580 billion recorded in the previous week.
• Spot market turnover increased by $791.39 million, translating to a 50.09% week-on-week growth and emerging as the sole driver of the overall increase in FX market activity.
• Average daily FX Spot turnover rose sharply to $474.26 million from $315.98 million in the previous week.
• FX Forwards declined to $14.50 million from $51.22 million, representing a 71.69% week-on-week contraction.
• Consequently, average daily FX Forward turnover fell to $2.90 million, compared with $10.24 million a week earlier.

FX derivatives contributed only 0.61% of total market turnover, down sharply from 3.14% in the preceding week. As in previous weeks, the Exchange-Traded FX Futures segment remained dormant, leaving FX Forward contracts to drive total derivatives turnover.

More insights:

The latest trading pattern suggests a clear shift in market preference toward immediate currency transactions rather than contracts for future delivery.

• Spot transactions involve the outright purchase or sale of foreign currency for near-immediate settlement and are typically used by importers, exporters, investors and banks to meet current payment obligations.
• By contrast, FX derivatives—particularly forward contracts—allow counterparties to lock in an exchange rate today for settlement at a future date, helping businesses hedge against exchange rate volatility rather than source immediate foreign exchange.

The overwhelming dominance of spot transactions during the week suggests that market participants were primarily focused on meeting immediate foreign currency demand, while the reduced use of forward contracts indicates softer demand for exchange-rate hedging as exchange rate stabilizes.

The shift also points to relatively improved confidence in near-term FX liquidity given improvements in Nigeria’s foreign reserves, reducing the need for businesses to secure future exchange rates through derivative instruments.

What you should know:

The latest report indicates an improvement over a sharp decline in the prior week when turnover crashed by more than 46%. More importantly, it reinforces a pattern seen in recent weeks where the spot market remains the dominant segment, driving Nigeria’s foreign exchange market.

• However, unlike previous reporting periods when both spot and derivatives contributed to market expansion, the week ended July 17 saw the entire increase in turnover driven exclusively by spot transactions.
• The concentration of 99.39% of total trading in the spot market also highlights the importance of immediate liquidity in supporting activity within Nigeria’s FX market

The derivatives segment continues to play a smaller but strategically important role in helping businesses manage future currency risks.