Nigerian Naira Depreciates As Interbank FX Turnover Slumps 78% – MarketForces Africa

Nigerian Naira Plummets 78% as Interbank FX Turnover Crash Fuels Reserve Gains

The Nigerian nerie declined sharply to N1,332 per US dollar in the foreign exchange market (NFEM) on Monday, propelled by optimism regarding the nation’s strengthening external reserves.

Although the broader forex sector remained relatively stable, foreign portfolio investors served as the primary drivers of supply, backed by non‑bank corporates, exporters, importers, and associated entities.

Heights in oil prices coupled with mounting global inflation worries initially paved the way for expectations of a Federal Reserve interest rate hike, but this bullish perspective was negated by the latest report highlighting a noticeable drop in US joblessness.

Data released by the Central Bank of Nigeria (CBN) on Monday indicates that the official window spot rate fell to N1332.0960 per US dollar, decreasing from N1331.1860 recorded at the prior close on Friday.

Traders on the broadstreets noted settlement values ranging between N1330.5000 and N1332.9900 against the US dollar during the day. Meanwhile, general banking activity slunk, characterized by a drastic reduction in interbank FX turnover at the week’s opening.

The central bank’s daily update reflected a substantial downturn in weekly interbank FX turnover, settling at $36.242 million on Monday—approximately an 78% decline compared with $162.736 million at Friday’s closing.

Foreign reserve levels in Nigeria recovered to $50.076 billion thanks to sustained hard‑currency inflows from overseas, including remittances. Even amid massive oil swap agreements, net foreign reserves posted a rise to $46 billion due to increasing private capital flows.

Uncertainties in global commodities since February have bolstered Nigeria’s fiscal standing, aided by strengthened crude oil output.

Crude prices advanced today amid attacks on Saudi Arabia outweighing anticipation for higher supply, while fresh Russian diesel exports and a US announcement outlining a ceasefire in the Ukraine conflict further shaped market trends. Consequently, the Nigerian nergy softened against the US dollar, euro, and British pound.

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