The naira strengthened by 0.50% in the official foreign exchange market, closing at ₦1,491.67 per dollar on Tuesday. This gain occurred despite the Central Bank of Nigeria (CBN) scaling back its market intervention. During the trading session, the exchange rate ranged between ₦1,490.00 and ₦1,503.00, indicating relative stability.
Over the previous week, foreign exchange inflows have decreased by 50%, according to data from the Nigerian Foreign Exchange Market (NFEM). Coronation Research reports that the market had an influx of $977.40 million, which is far less than the $1.96 billion that was recorded the week before. The CBN’s diminished contributions, which made up just 8.28% of total inflows, were the primary cause of the reduction.
Foreign portfolio investors (FPIs) contributed the most to the market, making up 40.53% of total inflows, followed by non-bank corporates (30.77%) and exporters (15.90%). Other sources accounted for 4.52%.
In the parallel market, the naira strengthened slightly, gaining N5 to trade at an average of N1,500 per dollar as demand pressure eased. Analysts predict ongoing efforts to stabilize the currency, with expectations that the CBN will implement further measures to support the naira. These may include tightening liquidity and improving forex supply channels.
Meanwhile, global oil prices fell as OPEC+ announced plans to increase output in April. Additional pressure came from new U.S. tariffs on imports from Canada, Mexico, and China, with China responding with its own trade restrictions. Brent crude dropped by $1.04 (1.45%) to $70.58 per barrel, while WTI crude declined by 73 cents (1.07%) to $67.64 per barrel.
But in the face of trade uncertainty, demand for safe-haven assets soared, driving up gold prices. After reaching a record $2,956.15 on February 24, spot gold continued its upward trajectory, rising 0.9% to $2,918.90 per ounce.
