Naira resumes trading with 0.8% gain despite drop in weekly inflows

The naira on Tuesday recorded a 0.8% gain against the dollar at the official foreign exchange (FX) market despite a decline in weekly inflows.

Data from the Central Bank of Nigeria (CBN) showed that by the close of trading in the Nigerian Foreign Exchange Market (NFEM), the naira appreciated by N13.07, with the dollar quoted at N1,540.04 compared to N1,553.11 quoted on Thursday before the two-day public holiday declared by the Federal Government.

At the parallel market, also known as the black market, the local currency traded flat. It closed at N1,607 on Tuesday, reflecting a marginal loss of N2 from N1,605 traded on Thursday before the holiday break.

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According to a report by Coronation Merchant Bank Limited’s research arm, the NFEM recorded an inflow of $780 million last week, lower than the $1.04 billion posted in the previous week.

The breakdown of inflows showed that exporters accounted for 18.83% the CBN contributed 19.78%, foreign portfolio investors (FPIs) made up 32.47%, non-bank corporates brought in 27.60%, while other sources accounted for 1.32%.

Meanwhile, CBN data indicated that Nigeria’s gross foreign exchange reserves stood at $38.33 billion as of Thursday, June 5, 2025, marking a decline of $120.97 million or 0.31%.

The naira had ended the previous holiday-shortened week with its strongest performance since December 2024, appreciating by 2.13% week-on-week to close at N1,553.12 per US dollar.

The parallel market reflected similar momentum, gaining 2.13% week-on-week to close at N1,585.00 per dollar. This positive trend was largely attributed to increased inflows from foreign portfolio investors.

In the forward market, the 1-month forward rate closed at N1,606.00 per dollar, the 3-month contract closed at N1,675.50 per dollar, the 6-month forward settled at N1,776.30 per dollar, and the 1-year forward rate ended at N1,977.47 per dollar.

Despite the weekly inflow drop, market sentiment remained upbeat, supported by capital market inflows and improved investor confidence.