Naira Appreciates to ₦1,382/$ in Parallel Market as Official Rate Softens

Naira Appreciates to ₦1,382/$ in Parallel Market as Official Rate Softens

The Nigerian naira showed mixed performance yesterday, appreciating to ₦1,382 per US dollar in the parallel market from ₦1,391 recorded on Wednesday. This rise reflects renewed confidence among traders in the informal foreign exchange market, even as the currency slightly depreciated in the official Nigerian Foreign Exchange Market (NFEM).

Data from the Central Bank of Nigeria (CBN) showed that the indicative official exchange rate moved to ₦1,361 per dollar, up from ₦1,359.5 per dollar on Wednesday — a ₦1.5 depreciation for the naira. Consequently, the margin between the parallel and official rates narrowed to ₦21 per dollar, down from ₦31.5 per dollar previously, indicating a reduction in the spread between formal and informal FX markets.

Experts say the parallel market gains were supported by improved dollar liquidity, steady remittance inflows, and robust external reserves, which recently reached levels not seen in over a decade. Analysts note that a narrowing spread between the black market and official rates typically signals growing market confidence and stability, even as structural challenges in Nigeria’s FX landscape persist.

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“While the naira is stronger in the parallel market, pressure remains on the official segment due to high demand for foreign currency by importers and businesses,” said a currency analyst. “The recent movements show optimism but highlight the ongoing volatility across exchange segments.”

The parallel market rate, often called the black market rate, responds quickly to dollar demand and supply at street level, while the official NFEM rate reflects CBN interventions and regulated forex flows. Observers say continued policy measures, remittance growth, and export receipts will be critical in maintaining naira stability ahead of the 2027 election period.

Despite the mixed trends, the recent appreciation in the parallel market is being viewed as positive for consumer confidence, though analysts caution that structural issues, including trade imbalances and uneven forex distribution, could still pressure the naira in coming weeks.

Naira Appreciates to ₦1,382/$ in Parallel Market as Official Rate Softens