Dealers Increase Dollar Exchange Rate in Black Market as Naira Gains in CBN's Official Market

• The value of the dollar improved in the unofficial foreign exchange markets on Wednesday, February 26, 2025, amid reports of a drop in FX reserves
• In the CBN's official foreign exchange market window, the naira improved slightly against the dollar
• Bismarck Rewane has praised the CBN's recent policies, which have helped the naira recover in recent weeks

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.

Nigerian currency, the naira, has recorded a mixed exchange rate against the US dollar in the foreign exchange markets.

In the official market, the latest data from the Central Bank of Nigeria showed that the naira improved in value against the US Dollar at the Nigerian Foreign Exchange Market (NFEM) on Wednesday, February 26 to N1,499.1.

Wednesday's exchange rate was a slight improvement from the N1,501.5 a dollar quoted on Tuesday, February 25.

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Naira in trouble as foreign reserves drop for 33 straight days

However, CBN data showed that the naira fell in value against the pound Sterling and the euro in the official market.

The pound, which closed at N1,894.72/£1 on Tuesday, sold at N1897, indicating naira depreciated by N3.

Also, against the euro the naira fell to N1,571 exchange rate on Wednesday compared to N1,570.11/€1 quoted on Tuesday.

Dollar improves in unofficial market

While the naira gained in the official market, Bureau de Change operators increased the value of the dollar by N10 on Wednesday, selling at N1,500/$1, in contrast to the preceding day’s N1,490/$1.

The change in exchange rates comes amid reports that foreign reserves have dropped significantly over the past month.

Bloomberg reported that the country's dollar reserves are down $2.2 billion since hitting a $40.92 billion high on January 6, 2025.

There is now speculation that the naira could be vulnerable going forward as Nigeria’s foreign reserves have fallen for 33 straight days.

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Again, dollar falls in foreign exchange market as official, parallel rates narrow

The decline in reserves follows comments from Bismark Rewane, who stated that the CBN is actively defending the naira, having spent over $8 billion to strengthen its value against major currencies, including the dollar, euro, and pound sterling.

Foreign reserves growth is important because it acts as a safety net for a country's economy, allowing it to stand against currency fluctuations, sudden capital outflows, or economic crises by providing readily available funds to intervene in the foreign exchange market and stabilise the domestic currency.

Bank releases new requirements to buy dollars at a cheaper rate

Earlier, Legit.ng reported that Wema Bank released requirements for its customers looking to buy foreign currencies at the official rate.

The bank stated that for a customer to purchase foreign currencies, one of the requirements is to provide a valid tax clearance certificate.

Wema Bank explained that the EFEM provides customers access to FX for Tuition Fees, Personal Travel Allowance (PTA), Business Travel Allowance (BTA), medical expenses, and other personal transactions under Form A.

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Naira sustains gains against pound, euro, Canadian dollar as USD trades at new rates

Proofreading by James, Ojo Adakole, journalist and copy editor at Legit.ng.

Source: Legit.ng