According to data from the Central Bank of Nigeria (CBN), the naira appreciated by 0.16 percent to 1530.52/$ at the close of trading on Wednesday, March 19, from 1532.93/$ in the previous session.
The naira traded as high as 1545/$ and reached a low of 1500/$, which was lower than Tuesday’s figures.
In the parallel market, CardinalStone Research reported that the naira remained unchanged at 1,585.00/$, causing the spread for speculative traders to widen.
Analysts noted that the gap between official and parallel market rates had narrowed to about 3.07 per cent from 3.40 per cent earlier in the week.
While the naira experienced a slight depreciation, analysts suggested that the market is stabilising, thanks to structural reforms and an increase in forex inflows.
Tilewa Adebajo, the Chief Executive Officer of CFG Advisory, shared her thoughts, highlighting the importance of adjusting the public’s mindset towards exchange rates.
She explained, “The reason we are seeing some stability is because there is a new system where everyone uses one portal to buy and sell their dollars or any other currency.”
Adebajo noted that most Nigerians abroad now use apps to transfer money to Nigeria, which automatically provides the official rate for transactions, leading to smoother processes.
She pointed out that parallel market operators have yet to adapt to this new system, and once they do, the country will move towards “price discovery.”
She added, “CBN is not the major supplier of dollars to the market anymore, and that is good. Our foreign exchange system has evolved, and many people have not yet understood this change.”
In an investor note, Comercio Partners also praised the naira’s recent stability.
“The naira’s relative stability deserves some credit here, holding steady in the N1,450-1,550 range against the dollar, which has helped curb import costs that were previously spiralling out of control,” the investment house said.
However, the note cautioned that sustained stability would rely on consistent policies and steady forex inflows.
“Nigeria’s long-term stability hinges entirely on sustained forex inflows, competitive market dynamics, and the Central Bank staying vigilant. A single policy misstep could send us right back to square one,” the report concluded.
Similarly, analysts at CardinalStone Research echoed these sentiments on Wednesday, noting that the FX rate had remained relatively stable since the beginning of the year, bolstered by the CBN’s efforts, a positive current account position, and increased foreign inflows.
Nevertheless, they warned of a key risk to the outlook—expectations of weaker global crude oil prices, which could undermine Nigeria’s forex stability and stoke inflationary concerns.
Brent crude prices have declined by 5.5 per cent year-to-date, driven by expectations of rising global supply, policy shifts, and weakening demand.
Furthermore, the U.S. has ramped up efforts to boost oil production, leading the Energy Information Administration to revise its 2025 crude production forecast to 13.61 mbpd, up from 13.55 mbpd, while OPEC+ has also reaffirmed its decision to gradually unwind 2.20 mbpd in voluntary production cuts starting in April 2025.
These moves could increase supply and put additional downward pressure on oil prices.
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