The naira depreciated against the US dollar in the foreign exchange (FX) market, even after the Central Bank of Nigeria (CBN) injected $112 million to support the currency.
The naira’s previous gains were undermined by an increase in demand for the US dollar and other foreign currencies for cross-border transactions.
According to analysts, the CBN would keep an eye on changes in the exchange rate, particularly as Nigeria gets ready to pay off its COVID-19-related debt in 2025.
According to the latest FX market data, the naira depreciated by 0.84% in the official window, closing at ₦1,530.15 per US dollar, down from ₦1,517.24 at the start of Monday’s trading session.
During early trading, dollar liquidity was relatively strong, leading to a calmer market as participants awaited CBN intervention. Transactions occurred at rates between ₦1,520 and ₦1,545, supported by inflows from foreign investors and local businesses, AIICO Capital Limited revealed.
To boost dollar supply, the CBN sold $112.20 million to authorized banks at rates between ₦1,524.5 and ₦1,537. However, despite this intervention, the naira still weakened by 85 basis points (bps) to close at ₦1,530.15.
Meanwhile, Nigeria’s external reserves fell to $38.35 billion due to continuous dollar sales to banks and debt servicing obligations.
Elsewhere, oil prices dipped on Monday amid uncertainty over US tariffs and increased output from OPEC+. However, potential sanctions on Iranian oil exports prevented further losses. Brent crude dropped by 44 cents to $69.92 per barrel, while US West Texas Intermediate (WTI) crude slipped by 40 cents to $66.64.
Even though there are still geopolitical risks, gold prices also somewhat decreased as investors grabbed profits after last week’s surge. US gold futures slipped 0.1% to $2,910.90, while spot gold dropped 0.2% to $2,904.50 an ounce.
