Naira Slides 0.11% to N1,331.20 on Tight FX Supply
The official naira rate closed at N1,331.20 against the US dollar on Friday. The currency lost 0.11% of its value at the Nigerian Foreign Exchange Market. This decline follows a week of uneven liquidity conditions.
The naira closed at N1,331.2027 to the US dollar at the Nigerian Foreign Exchange Market on Friday. This represents a drop of N5 from the previous close of N1,326.5192. Trading occurred between a low of N1.324 and a high of N1,334.5000 per dollar.
Strong foreign demand and fluctuating supply drove the price action. The local unit depreciated 0.11% in the official market. It weakened 0.36% in the parallel market to N1,390. GN auto markets/forex: exchange rate data confirms the widening gap between the two rates.
Spread Widens Amid Liquidity Constraints
The official-parallel market spread increased to N58.72 from N55.15. Meristem Securities Limited reported this divergence. Interbank activity remained uneven, with demand outpacing supply during the week. The Central Bank did not close the liquidity gap.
Interbank FX turnover reached a weekly peak of $262.120 million on Tuesday. Volume fell to a low of $84.217 million on Thursday. This pattern indicates strained FX liquidity. The naira repriced lower against Western currencies, particularly the US dollar.
Reserves Support Bullish Year-End Outlook
Broadstreet analysts maintain a bullish outlook for the naira. They shifted the year-end projection to N1,300 per dollar from N1,350. This change reflects recent exchange rate appreciation. The outlook is anchored on rising external reserves.
Nigeria’s gross external reserves accelerated to about $54.7 billion. This is the highest level in 18 years. Reduced demand for oil imports and elevated hydrocarbon revenue contributed to this growth. The Central Bank derives the NFEM rate from a volume-weighted average.
