The Nigerian naira exhibited a mixed performance for the week ending June 13, 2025, strengthening in the parallel market while depreciating in the official market, according to data from the Central Bank of Nigeria (CBN).
This contrasts with the previous week’s synchronized appreciation across both markets, underscoring persistent volatility in Nigeria’s foreign exchange system.
Official Market Performance
Closing Rate: The naira closed at N1,554/$1 on Friday, June 13, 2025, down from N1,545/$1 on Wednesday and N1,540/$1 on Tuesday, marking a week-long depreciation trend.
Intraday Trading: The naira fluctuated between a high of N1,570/$1 and a low of N1,537/$1 on Friday, with a simple mean of N1,551.85/$1.
Context: The depreciation follows a week of consistent weakening in the official market, raising questions about the effectiveness of CBN’s recent interventions, including the Enhanced Foreign Exchange Market System (EFEMS) launched in December 2024.
Parallel Market Performance
Closing Rate: The naira appreciated to N1,595/$1 on Friday, up from N1,610/$1 on Wednesday and slightly stronger than N1,600/$1 on Tuesday.
Against Other Currencies: The naira weakened against the British pound, trading at N2,148.00/£1 on Friday, down from N2,145.00/£1 on Wednesday.
Context: The parallel market’s gains suggest improved dollar liquidity or reduced speculative pressure, offering relief to retail forex users.
Market Dynamics
Exchange Rate Gap: The spread between the official (N1,554/$1) and parallel (N1,595/$1) markets was N41 on Friday, narrower than earlier in 2025 but still indicative of market distortions.
CBN Interventions: The CBN extended weekly forex sales of $25,000 to Bureau de Change (BDC) operators until May 30, 2025, and introduced EFEMS to enhance transparency. However, sustained dollar demand and external pressures, such as global oil price fluctuations, continue to challenge stability.
External Factors: Posts on X highlight concerns about Nigeria’s external reserves and the impact of global oil price volatility, exacerbated by tariff threats, on the naira’s performance.
Last Week’s Context
Last week, the naira appreciated across both markets, closing at N1,540/$1 (official) and N1,605/$1 (parallel) by June 11, driven by post-Sallah holiday optimism and improved forex supply.
This week’s divergence suggests that short-term gains may be fragile without sustained policy measures and economic diversification.
Outlook
MPC Meeting: The CBN’s Monetary Policy Committee is scheduled to meet on June 19–20, 2025, to discuss the Monetary Policy Rate (MPR) and forex interventions.
Analyst Insights: Analysts emphasize the need for structural reforms, including boosting non-oil exports, to ensure long-term naira stability.
Market Sentiment: While the parallel market’s gains provide short-term relief, the official market’s depreciation underscores ongoing challenges in unifying Nigeria’s forex markets.
WHAT YOU SHOULD KNOW
The naira’s mixed performance reflects the complexities of Nigeria’s foreign exchange landscape. While parallel market gains signal improved retail liquidity, the official market’s depreciation highlights structural vulnerabilities.
The CBN’s ongoing reforms and upcoming policy decisions will be critical in determining whether the naira can achieve sustained stability.
