Naira Bounces Back in Official Window as Traders Sell Dollar High in Black Market
- The Nigerian currency has recorded some recovery in the Nigerian Foreign Exchange Market (NFEM) on Monday, March 10, 2025
- The naira’s value rose to N1,528 from N1,542 in the official window on Monday, March 10, 2025, for the first time in six days
- However, the naira depreciated in the black market as currency dealers quoted the dollar at N1,570 from N1,545
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Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
After days of depreciation, the naira rebounded in the official Nigerian Foreign Exchange Market (NFEM) on Monday, March 10, 2025.
The naira was buffeted for most of last week following a dwindling reserve that depreciated by over $1 billion in February.
Source: Getty Images
Naira recovers N45 to a dollar.
From March 4, 2025, through March 7, 2025, the naira shed about N45 against the US dollar, widening the gap between the parallel and official windows.
The naira recorded its best moments on March 3, 2025, when it traded for N1,499 to a dollar before dropping to N1,542.
However, on Monday, March 10, 2025, the local currency rebounded, trading at N1,528 per dollar from N1,542 on Friday, March 8, 2025.
The N14 recovery is massive considering it narrowed the gap between the parallel and official market rates.
Currency dealers quoted the dollar at a high of N1,540 and a low of N1,512 per dollar in the official window.
The naira depreciates in the parallel market
Meanwhile, the naira depreciated in the parallel segment of the foreign exchange market on Monday, March 10, 2025, trading at N1,570 to a dollar from N1,545.
Consequently, the gap between the official and black market windows widened to N42 from N3 on Friday, March 8, 2025.
Coming amid foreign reserves depreciation, analysts say that the naira’s current rate may be its actual value as it continues to hover around the N1,500 ceiling since December 2024.
Chatham House warns against stronger naira
Legit.ng earlier reported that Chatham House, a United Kingdom (UK) international affairs policy think tank, warned against making the naira stronger, saying strengthening it is not in Nigeria’s interest.
Chatham House noted that after its depreciation, the naira is better positioned to help the Nigerian economy progress.
In an article titled ‘Nigeria’s Economy Needs the Naira to Stay Competitive’, the think tank noted that while inflation has surged under President Bola Tinubu, strengthening the naira was not the best way to improve the situation.
It argued that the weaker naira has made Nigeria more competitive, compared to previous years when the naira exchanged around N460/$.
Chatham House lists the benefits of weaker naira
In the article, Chatham House noted that while it is tempting to strengthen the naira to make imports cheaper and lower inflation levels, the federal government should not take that route.
Source: Getty Images
Chatham House further argued in the article that the naira depreciation has improved Nigeria’s Balance of Payments and return of capital into the country, helping the CBN to increase its foreign exchange reserves to prudent levels where it is roughly around the same level as the foreign debts.
Naira trades at new rates as banks sell dollar at high prices
Legit.ng earlier reported that on Wednesday, March 5, 2025, currency dealers quoted the dollar at a high of N1,505 and a low of N1,497.10 to a dollar.
The current naira’s new value came amid the depreciation of Nigeria’s foreign exchange reserves.
According to data from the Central Bank of Nigeria, the nation’s reserves stood at $38.4 billion as of March 5, 2025, relative to $38.3 billion.
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Source: Legit.ng
