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… As CBN increases dollar sales amid heightened demand The naira weakened by N17.44 in a single trading day on

… As CBN increases dollar sales amid heightened demand

The naira weakened by N17.44 in a single trading day on Friday as turnover in the interbank foreign exchange (FX) market surged to an all-time high of $1.01 billion, even as the Central Bank of Nigeria (CBN) increased its dollar sales to meet demand. 

Data published by the CBN showed that the naira depreciated by 1.28 percent, with the dollar quoted at N1,361.84 on Friday, compared with N1,344.40 on Thursday at the Nigerian Foreign Exchange Market (NFEM). 

In the parallel market, also known as the black market, the local currency depreciated by N12, or 0.87 percent, to close at N1,385 per dollar on Friday from N1,373 the previous day.

The gap between the official and parallel market rates narrowed to N24, representing 1.76 percent, compared with N33, or 2.46 percent, recorded earlier in the trading period. 

The latest depreciation followed a similar movement on Thursday, when the naira lost N9.68 against the dollar at the NFEM amid heightened demand for foreign exchange and increased CBN interventions.

Market information on Thursday indicated that the apex bank had sold $150 million on Wednesday and another $300 million on Thursday before increasing its intervention. It reportedly sold $300 million at N1,345 before the market rate moved to N1,400, and subsequently sold another $500 million at N1,344, bringing reported dollar sales to $800 million by 1:30 p.m.

The sustained pressure on the naira, despite the increased dollar supply, has raised questions about the nature of demand in the foreign exchange market and whether the recent transactions reflect temporary payment obligations, profit-taking by foreign portfolio investors or a broader shift in capital flows.

However, analysts have cautioned against interpreting the increased dollar demand as evidence of capital flight, saying a longer period of trading data and information on portfolio flows would be required to establish whether foreign investors were withdrawing funds from the Nigerian market.

Ayodeji Ebo, chief executive officer of MDU Capital, said it would be premature to conclude that foreign portfolio investors were exiting based on two days of CBN dollar sales.

He said the demand could be driven by large, one-off transactions or import payments, while slightly lower fixed-income yields might be encouraging some portfolio managers to take profits after benefiting from attractive interest income and naira appreciation.

Similarly, Ayokunle Olubunmi, head of Financial Institutions Ratings at Agusto & Co., said a longer period of data was needed to determine whether the CBN’s dollar sales reflected a sustained change in market conditions.

Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise, also said the naira’s movement over two days was insufficient to establish a trend of capital-flow reversals, adding that several weeks of trading data would be needed to determine whether portfolio flows were reversing.

Nigeria’s external reserves, which provide the CBN with the capacity to intervene in the foreign exchange market and meet the country’s external obligations, have maintained an upward trajectory, rising to $55.16 billion as of October 22, 2026.

Data published on the CBN website showed that the reserves increased by 28.67 percent from $42.87 billion recorded in the corresponding period of 2025, strengthening the country’s external buffer amid renewed pressure on the naira.