New Exchange Rate: Dollar Falls in All Markets as Naira Strengthens Amid Declining Reserves
- The Nigerian currency maintained a steady stance against the dollar, strengthening by 0.56% last week
- The naira appreciated to N1,509 per dollar on Friday, 20, 2025, from N1,510 it traded the previous day
- For the first time in two years, the parallel and official windows of the foreign exchange markets converged at N1,510 per dollar
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Nigerian currency, the naira held steady across all forex markets despite the decline in the nation’s reserves.
Information from the Central Bank of Nigeria (CBN) indicated that the naira rose in value to N1,502 per dollar week-on-week, gaining 0.56% or N8.50 relative to N1,511 it closed the previous week at the Nigerian Foreign Exchange Market (NFEM).
Source: Getty Images
Dollar sells cheaper in all markets
Currency dealers quoted the dollar at a high of N1,509 more than the N1,520 quoted the previous week.
On Friday, February 21, 2025, the naira traded at N1,491 per dollar, compared to N1,500 at NFEM.
In the parallel segment of the foreign exchange market, the local currency rose by N45, appreciating 2.0% as buyers and sellers quoted the US dollar at N1,510 on Thursday, February 20 and Friday, February 21, 2025.
Meanwhile, data from the CBN shows that Nigeria’s FX reserves depreciated to $38.73 billion as of February 20, 2025, indicating a loss of $360 million or 0.9% per week from $39.09 billion recorded on February 13, 2025.
Nigeria’s dollar reserves decline
The reserves declined by $2.15 billion yearly, a loss of 5.25% relative to the $40.88 billion recorded at the beginning of the year.
A BusinessDay report said that CBN governor Olayemi Cardoso revealed that the external reserves remained strong at $39.4 billion as of February 14, 2025, enough to support 9.6 months of imports of goods and services.
Cardoso also said the balance of payments was about $6.06 billion at the end of the third quarter of last year.
The Nigerian currency has been stable in the FX market since the CBN mandated traders to migrate to the Electronic Foreign Exchange Matching System (EFEMS) through the Bloomberg BMatch system.
According to reports, the FX market rates for the naira converged for the first time in almost two years on Thursday, February 20, 2025.
Dollar sells at the same rates in all windows
On Wednesday, February 19, 2025, the naira sold on the streets at N1,510, the same rate as the official window.
The current black market rate brings the naira’s yearly gain to N155 per dollar or 10.3%, relative to N1,665 quoted at the beginning of the year.
Source: Getty Images
Experts have commended the CBN’s efforts at trying to narrow the gap between the market, which was a key plank of the foreign currency reforms of the present government.
Janet Ogochukwu, a senior banker and economist, disclosed that the naira’s current stability is due to CBN’s raft of policies, disclosing that the recent launch of the FX Code was a clincher in the naira’s rally.
“Apart from reflecting the naira’s actual value, the reforms have helped to narrow the gap between the official and parallel windows. This was the key reason for devaluing the naira and embarking on FX reforms,” she said.
The dollar falls markets as the naira trades at new rate
Legit.ng earlier reported that the naira’s value rose in the parallel segment of the foreign exchange market on Wednesday, February 19, 2025, as the US dollar hit a new low.
The naira appreciated N1,550 per dollar in the black market with traders saying that demand pressure for the US greenback has reduced.
Data from Nairarates, the website publishing black market rates, shows that the currency dealers quoted the naira at a high of N1,545 and a low of N1,530 before settling at N1,550.
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Source: Legit.ng
