The naira weakened further on Tuesday, April 29, 2025, closing at N1,602.02 per dollar at the official Nigerian Foreign Exchange Market (NFEM), according to data from the Central Bank of Nigeria (CBN).
This marks a continued depreciation from Monday’s closing rate of N1,596/$1 and reflects ongoing instability in Nigeria’s currency markets, fueled by persistent dollar shortages and speculative demand.
Intraday trading showed a high of N1,602.02 and a low of N1,596.7, with an average rate of N1,600.04/$1. The drop signals a widening gap between the naira’s value on different trading days and the increasing strain on the country’s foreign exchange liquidity.
In the parallel market, the dollar exchanged for as much as N1,610 in Abuja’s Zone 4 trading hub, further diverging from the official rate and highlighting the growing influence of the informal market on exchange rate expectations.
Forex dealers reported rising demand from importers and individuals seeking foreign currency for transactions abroad, a trend that continues to outpace available supply.
Analysts point to multiple causes for the naira’s persistent slide, including limited dollar inflows from oil exports, subdued foreign direct investment, and U.S. monetary tightening. “Without a meaningful increase in forex inflow, the naira will remain under pressure,” said economist Bulus Anag.
While CBN reforms such as exchange rate unification and backlog clearance have helped improve market transparency, analysts argue these measures have not yet stabilized the naira. “Confidence remains low, and we’re not seeing the scale of inflows needed to balance demand,” noted a forex analyst at Ren Money.
Traders expect the naira to fluctuate between N1,600 and N1,620 per dollar in the near term unless boosted by oil revenue, Eurobond inflows, or international financial support.
Meanwhile, the CBN continues its broader financial reforms. On Monday, it directed all banks to adopt the Pan-African Payment and Settlement System (PAPSS), allowing simplified documentation for smaller foreign exchange transactions.
Additionally, the CBN raised over N1 trillion at its most recent Open Market Operations auction, signaling continued efforts to tighten monetary policy and absorb excess liquidity.
Despite these steps, market sentiment suggests that until forex inflows increase, the naira will likely remain volatile.
