Naira Rises to ₦1,375/$ in Parallel Market as Exchange Rate Gap Narrows

The Nigerian naira appreciated to ₦1,375 per US dollar in the parallel market on Wednesday, gaining ground from ₦1,383/$ recorded a day earlier as the currency continued its recent recovery against the greenback. The improvement was mirrored in the Nigerian Foreign Exchange Market (NFEM), where the naira also strengthened, signaling renewed stability across both segments of the foreign exchange market.

Data published by the Central Bank of Nigeria (CBN) showed the indicative official exchange rate appreciated to ₦1,328/$, compared with ₦1,331/$ on Tuesday. The ₦3 gain in the official market, combined with the stronger parallel market performance, narrowed the gap between the two exchange rates to ₦47 per dollar, down from ₦52 previously.

The day’s trading also recorded a significant increase in market activity. Interbank turnover in the NFEM surged by 181.5% to $279.2 million, rising sharply from $99.2 million in the previous session. Analysts say the jump in liquidity reflects stronger participation in the formal foreign exchange market and improving confidence among market participants.

The naira’s appreciation comes as Nigeria’s external reserves continue to strengthen, with the country’s foreign exchange reserves standing at approximately $54.67 billion. The higher reserve level has reinforced expectations that the CBN will retain sufficient capacity to support market liquidity and moderate excessive exchange rate volatility when necessary.

The latest movement follows a series of monetary and foreign exchange reforms implemented by the CBN, including the unification of exchange rate windows and the operation of the “willing buyer, willing seller” framework under the NFEM. The central bank has maintained that a more transparent, market-driven system is essential to improving price discovery and restoring confidence in the naira.

Currency traders noted that although the parallel market does not have a single nationwide rate, quotations around ₦1,375/$ were widely reported across major trading hubs. Rates may still vary depending on location, transaction size and dollar availability, but the narrowing spread suggests a closer alignment between the official and informal markets than seen during previous periods of sharp volatility.

The strengthening of the naira offers cautious optimism for businesses and households with dollar-denominated obligations, including importers, manufacturers, students and international travellers. While exchange rate stability remains dependent on sustained foreign exchange inflows and market confidence, the latest gains indicate that Nigeria’s currency is continuing to recover amid improving liquidity conditions.