Dollar Crashes Massively Against Naira, Traders Now Sell at New Exchange Rate
- The value of the dollar has depreciated significantly in the official and unofficial foreign exchange markets
- New data showed that the naira was selling below N1,600 in the unofficial market for the first time in 2025
- The new exchange rates indicated that recent policies introduced by the Central Bank of Nigeria were working
Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The naira has once again appreciated against the United States dollar in the parallel market, popularly called the black market.
Checks on Wednesday, February 5, 2025, showed that the dollar had crashed to below N1,600 for the first in over seven months.
Source: Getty Images
Traders who spoke to Legit.ng confirmed that the dollar was sold at N1,582 exchange rate and bought at N1,565/$.
The latest exchange rate was a huge win for the naira considering that at the beginning of the year in the parallel market, the naira exchanged as high as N1,665.
Naira vs dollar: official exchange rate
The naira remained steadied at N1,499 per dollar at the Nigerian Foreign Exchange Market (NFEM) on Wednesday, February 5.
Currency dealers attributed the naira appreciation to improved dollar supply and moderation in demand for the greenback, following the Central Bank’s policies.
In recent weeks the CBN has introduced several policies notably the launch of the Nigerian Foreign Exchange Code (FX Code), which has created positive sentiments around the naira.
At the launch, Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN) said the code would promote accountability, ensure compliance, and engender transparency in the country’s foreign exchange market.
He emphasised that the Nigerian FX Code sets clear and enforceable standards for ethical conduct and governance in the foreign exchange market, addressing past challenges that undermined market integrity.
"We must not forget where we are coming from. The era of multiple exchange rates, which created privileges for a select few at the expense of most Nigerians, inflicted significant damage on market integrity.”
“Practices such as unprecedented ways-and-means financing contributed to inflation, currency depreciation, and eroded public confidence. These practices must never return."
Speaking to Legit.ng about recent moves by CBN, Aminu Gwadabe Association of Bureau De Change Operators of Nigeria (ABCON) backed the FX code.
He noted that the apex bank’s FX Code is comprehensively addressing various aspects of market conduct and practice.
Gwadabe said:
"The code will further entrench transparency and accountability in the FX market, and continually sustain naira rally."
He urged all BDCs and authorized dealers to comply with the FX code guidelines in their operation while also adopting regulatory, management for sustained naira improvements.
Source: Getty Images
NESG predicts N1,300 exchange rate
Recently, the Nigerian Economic Summit Group (NESG) predicted a massive naira appreciation to an average exchange rate of N1,300 to the US dollar in 2025.
The optimistic projection was stated in its 2025 economic outlook, released on Thursday, January 23, 2025.
According to NESG, the exchange rate forecast was based on higher foreign exchange earnings, driven by increased crude oil sales, revitalised manufacturing output from the oil refining sub-sector, and improved agricultural productivity.
CBN cancels BDCs renewal licence fee in 2025
Earlier, Legit.ng reported that the CBN had removed the 2025 licence renewal fee for all Bureau de Change operators.
This occurred after the bank announced updated guidelines for BDC operators to improve oversight and compliance.
The deadline for recapitalisation of BDC operators was moved from December 3, 2024, to June 3, 2025, by the central bank.
Proofreading by James, Ojo Adakole, journalist and copy editor at Legit.ng.
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Source: Legit.ng
