WHEN THE GREENBACK GOT ITS GROOVE BACK
After a brief stretch of calm, Monday’s trading jolted Nigeria’s foreign exchange market.
At the official window, the naira closed ₦1,470.26/$, marking a 0.3% depreciation from Friday’s ₦1,465.67.
In the parallel market, it weakened further to ₦1,485/$, a ₦25 drop.
CBN data confirmed total inflows into the market dipped from $1.18bn to $835.6m in one week — a 29% plunge that rattled investors already wary of global oil-price headwinds.
“This week’s movement is a mirror of thinner liquidity,” said a Coronation Merchant Bank report seen by IDNN.
⚡ THE SLIDE BEHIND THE SCREEN — WHY IT HAPPENED
The slump isn’t panic yet; it’s pause.
Foreign portfolio investors slowed inflows pending fresh monetary guidance. Exporters hesitated to repatriate earnings amid uncertainty about FX windows, while speculative demand crept up in Lagos and Kano.
CBN insiders said the apex bank intervened with a modest liquidity push to avoid “knee-jerk” market reactions.
At the same time, gross external reserves inched up by 0.36% to $42.41bn, a signal that Nigeria still holds enough FX firepower for short-term defence.
WHERE THE PRESSURE SHOWS
- The official–parallel gap widened slightly to ₦15, reversing last week’s narrow ₦10.
- Importers of raw materials face higher short-term costs.
- Retail forex demand surges as holiday travel season begins.
- Market analysts say intervention flows may stabilise rates before Friday.
🔥 THE RIPPLE ACROSS WALL STREET AND OBALENDE
Nigeria’s currency story doesn’t exist in isolation.
Global sentiment toward emerging-market currencies remains cautious as US inflation data and OPEC output shifts keep investors edgy.
Still, domestic reforms — particularly CBN’s tighter intervention model and restored transparency in the FX auction system — are helping cool nerves.
“This isn’t a crash; it’s a correction,” said financial analyst Damilare Ayeni. “CBN is finally managing expectations instead of firefighting.”
In local markets, the dip sent import-dependent traders into a brief scramble, while dollar hoarders took advantage of momentary volatility.
💰 COMMERCIAL TAG — WHO FEELS THE HEAT, WHO SMELLS OPPORTUNITY
Banks and authorised dealers face tighter margins this week as volatility dampens arbitrage.
Importers are forced to hedge earlier, locking in exchange rates before shipment.
Meanwhile, remittance operators and fintech platforms like Flutterwave and Moniepoint are cashing in on the chaos, processing more diaspora transfers as households exploit higher conversion rates.
For investors, the play is patience — analysts say Nigeria’s currency reform structure remains intact. Once inflows return to last week’s $1.1bn average, the naira should retrace quickly.
This is IDNN. Independent. Digital. Uncompromising.
