The naira ended the week on a strong footing, appreciating to N1,579/$1 on Friday, May 23, 2025, in the official foreign exchange market. According to data from the Central Bank of Nigeria (CBN), the naira gained strength from Thursday’s close of N1,586/$1, which was its only decline throughout the week. Earlier in the week, the local currency showed steady appreciation, trading at N1,597/$1 on Monday, N1,588.5/$1 on Tuesday, and N1,583/$1 on Wednesday. The CBN reported that on Friday, the naira traded within a range of N1,575.13/$1 (low) and N1,585/$1 (high), with an average rate of N1,581.59/$1. On a weekly basis, the naira appreciated from its closing rate of N1,599.01/$1 on Friday, May 16, ahead of the Central Bank’s Monetary Policy Committee (MPC) meeting.
Performance against other major currencies was mixed. The naira weakened against the British pound, closing at N2,136.75/£1 on Friday, down from N2,127.96/£1 on Thursday and N2,126.23/£1 on Wednesday.
However, it appreciated against the euro, ending Friday at N1,791.95/€1 compared to N1,795.07/€1 a day earlier.
Parallel Market Maintains Relative Stability
In the parallel market, the naira held steady at N1,620/$1 on both Thursday and Friday, following gains from N1,625/$1 on Wednesday and N1,627/$1 on Monday, based on data from Lagos.
The pound sterling traded at N2,150/£1 on Friday slightly weaker than N2,135/£1 on Thursday, but firmer than N2,155/£1 on Wednesday and N2,145/£1 on Tuesday. The week had opened at N2,142/£1. Against the euro, the naira slipped to N1,835/€1 on Thursday from N1,820/€1 on Monday and Wednesday, though it remained stronger than Tuesday’s N1,825/€1.
FX Reforms Boost Investor Confidence
Femi Otedola, Chairman of First Holdco Plc, commended President Bola Tinubu’s economic agenda and the CBN’s monetary policy approach under Governor Yemi Cardoso. Speaking at the company’s 13th Annual General Meeting, Otedola stated:
“I commend the Governor of the Central Bank of Nigeria, Mr. Yemi Cardoso, for his courageous and pragmatic policy reforms. His actions are restoring credibility to the financial system and giving investors like me the confidence to commit long-term capital to this country.”
At the Qatar Economic Forum, Tony Elumelu, Chairman of UBA and a member of the Presidential Economic Coordination Council shared similar views:
“The naira is becoming quite stable. …. Currency volatility is a challenge for Africa and Asia. In the global south, fixing the volatility of our currencies will be very critical for ultimately developing our economies.”
CBN Interventions Support Market Stability
The recent stability of the naira is largely attributed to targeted CBN interventions, such as clearing FX backlogs, introducing high-yield fixed-income instruments to attract foreign portfolio investments, and boosting dollar supply in the market.
Despite these proactive measures, the CBN held its benchmark interest rate steady at 27.5% for the second time this year.
