The US dollar appreciated against the Nigerian naira on Monday, driven by strong year-end demand from importers, businesses, and holiday travellers. While the parallel market saw slight increases in rates, the official Nigerian Foreign Exchange Market (NFEM) remained relatively stable.
Official Rates Remain Stable
At the official NFEM window—managed by the Central Bank of Nigeria (CBN)—the naira traded between ₦1,440 and ₦1,446 per dollar, according to CBN figures and independent market monitors.
This stability continues to provide a reliable benchmark for large corporate and government transactions, even as other markets fluctuate.
Parallel Market Records Mild Increase
In the parallel market, including bureaux de change in Lagos, Abuja and Port Harcourt, the dollar traded at ₦1,455 for buying and ₦1,465 for selling.
Operators attributed the rise to:
- Heavy demand from importers stockpiling goods ahead of the festive season
- Travellers seeking foreign currency for international trips
- Seasonal pressures that typically push up demand in informal FX channels
Why the Markets Are Diverging
Analysts say the gap between official and parallel markets is influenced by:
- Limited liquidity in the official FX window
- Increased reliance on the parallel market for quicker access
- CBN’s ongoing monetary policies aimed at inflation control
- A cautious stance on interest rate adjustments, which stabilises official rates
While the official NFEM remains steady, the parallel market reacts more sharply to everyday demand.
Impact on Businesses and Individuals
- Importers and SMEs depending on the parallel market face slightly higher operational costs.
- Businesses servicing dollar-denominated loans may see increased repayment pressure.
- Remittance receivers and users of official channels benefit from more predictable rates.
The festive season could further influence demand, especially in the informal sector.
Outlook: What to Expect in Coming Weeks
Economists say the naira’s performance through December will depend on:
- CBN’s forex injections
- Crude oil export proceeds
- Diaspora remittances
- Market confidence
Depending on these factors, the gap between official and parallel rates could widen or narrow as the year winds down.
Related: Tinubu Declares Nationwide Security Emergency, Orders Massive Recruitment Into Army and Police
