MARKET NEWS

The naira on Wednesday surged to a four-month high of N1,526.15 per dollar in the official foreign exchange (FX) market, supported by improved liquidity as foreign portfolio investors (FPIs) continue to inject dollars into the economy.

This marks the strongest level since March 14, 2025, when the naira traded at N1,517.93 at the official market.

According to data from the Central Bank of Nigeria (CBN), the naira appreciated by 0.2 percent on Wednesday, compared to N1,529.57 quoted the previous day at the Nigerian Foreign Exchange Market (NFEM).

The parallel market also saw a modest gain, with the naira closing at N1,557 per dollar, improving from N1,560 the day before, street traders confirmed.

In the past six weeks, FPIs have emerged as the dominant source of FX inflows, overtaking exporters, non-bank corporates, and even the CBN. Their sustained interest in Nigeria’s fixed income market has bolstered FX supply and supported the naira’s upward trajectory.

Analysts at FSDH Merchant Bank noted that the naira’s gradual appreciation and the narrowing gap between the official and parallel market rates reflect growing confidence in the FX market. They attributed this development to the CBN’s clear policy direction, which has curbed speculative demand, encouraged FX inflows, and diminished opportunities for arbitrage and rent-seeking.