Naira Slides to N1,390/$, Extends Weakness in Official Market

The naira continued its downward trajectory at the official foreign exchange window, closing at N1,390 to the dollar and extending a depreciation streak that has lasted nearly two weeks.

Data released by the Central Bank of Nigeria indicate a steady weakening pattern since mid-February, reflecting sustained demand pressure in the official market.

From N1,337/$, the currency recorded incremental daily losses across successive trading sessions, moving through N1,340/$, N1,346/$, N1,348/$, N1,353.5/$, N1,359/$, N1,361.5/$, N1,368.5/$, N1,376/$, before settling at N1,390/$.

The sustained depreciation underscores mounting demand pressures and foreign exchange liquidity constraints. The widening gap between the official and parallel markets has also created arbitrage incentives, further intensifying demand within the formal window.

Although Nigeria’s external reserves have improved, short-term liquidity challenges remain a concern for market participants.

The Governor of the Central Bank of Nigeria, Olayemi Cardoso, recently disclosed that net foreign exchange reserves rose to $34.80 billion at the end of last year, while gross reserves climbed to $50.45 billion in the early part of the year.

Analysts note that while stronger reserves provide a cushion against shocks, sustained capital inflows and improved liquidity conditions will be critical to stabilising the currency in the near term. Externally, the U.S. dollar has strengthened amid geopolitical tensions, adding further pressure on emerging market currencies, including the naira.