Market News

by   Tony Chukwunyem

Although it weakened against the dollar at both the the Nigerian Autonomous Foreign Exchange Market (NAFEM) and the parallel market, last week, the naira is likely to remain stable against the greenback this week, analysts at Coronation Merchant Bank have predicted. The analysts made the prediction in the bank’s latest “Nigeria Weekly Update” report released yesterday.

According to the analysts, the naira will be boosted by “sustained FX inflows and Central Bank of Nigeria (CBN) support.” The analysts stated: “The naira weakened against the US dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) last week, depreciating by 0.16% w/w to close at N1,535.04/US$1, after hitting an intraweek low of N1,536.73/US$1.

In the parallel market, the currency recorded a steeper decline, losing 0.65 per cent w/w to settle at N1,550.00/US$1. “During the week, the Central Bank of Nigeria (CBN) offered a spot rate of 25.99 per cent pa on OMO securities with 124 days to maturity, higher than investors had expected and indicating a likelihood that the CBN is seeking to attract and keep offshore inflows for longer to sustain FX liquidity.

“Total FX inflows settled at $751.70 million for the week, lower than the $787.50 mn recorded in the previous week. Exporters emerged as the leading contributors, accounting for $216.10 million (28.75%) of total inflows. This was followed by non-bank corporates with $203.90 million (27.24%), while foreign portfolio investors (FPIs) contributed $175.60 million (23.36%).

CBN accounted for inflows of $137.4 million (18.27%). Meanwhile, inflows from individuals and other sources accounted for 0.50 per cent and 1.87 per cent, respectively.” Noting that data released by the CBN shows that the country’s gross external reserves increased by $242.08 milliin (0.59%), to reach $41.08 billion as of last Thursday (August 21, 2025), the analysts said: “Barring any external shocks, we expect naira to remain broadly stable, trading within the current range, underpinned by sustained FX inflows and CBN support.”