Naira Strengthens as FX Reserves Hit $41.2bn: Fresh Dollar Inflows Boost Confidence
- The Nigerian currency rebounded in the official and parallel markets following dollar inflows
- Data from the Central Bank of Nigeria (CBN) indicated a strong dollar inflow into the nation’s forex reserves
- Despite weak crude oil prices, Nigeria’s external reserves gained $900 million in days to hit $41.22 billion
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Nigerian currency, the naira, appreciated slightly to N1,537 per dollar
The naira strengthened marginally to N1537 per dollar at the foreign exchange market amidst sustained accretion into Nigeria’s foreign reserves.
Source: Getty Images
Inflows pull the naira out of depreciation
Data from the Central Bank of Nigeria (CBN) shows that the local currency rebounded from the previous day’s loss caused by increased demand for the US greenback.
According to reports, the FX rate closed at N1,537.07 per dollar at the official window, from N1,537.61 the previous day.
Analysts have attributed the naira’s recovery to dollar inflows from foreign portfolio investors (FPIs) participating in the CBN open market operations.
Forex dealers quoted the dollar at a high of N1,538.50 and a low of N1,536.23, before closing at N1,536.25 per dollar.
The naira shows strength in the parallel market
Findings showed that the naira also appreciated in the parallel segment of the foreign exchange market, closing at N1,542 per dollar, as local banks and authorised dealers sold FX to customers using naira debit cards.
The debit cards were reportedly pegged at N1,544 per dollar on Wednesday, August 27, 2025.
Experts have said that the naira will remain relatively stable, trading within the current range due to sustained inflows and CBN interventions.
A new report from the apex bank revealed that forex inflows into Nigeria’s external reserves have continued.
Nigeria’s reserves remain robust
The CBN data showed that accretion into the reserves rose by $900 million in days, hitting $41.22 billion, from $41.19 billion as of Wednesday, August 27, 2025.
Nigeria’s rising reserves could be directly linked to FPI inflows and improved crude oil out, which rose to 1.71 million barrels per day in July despite volatility in benchmark prices, according to a recent Legit.ng report.
Crude oil prices fluctuate
Data showed that energy trading remained seasonally low in the ongoing summer season, as traders turned towards larger macroeconomic news.
According to details from the traders, Brent Crude for October delivery has been pegged at $68.80 per barrel as of Monday, August 25, 2025.
Experts say the rate is the highest settlement price in almost a month, before settling at $67.4 per barrel.
Source: Getty Images
Brent prices briefly broke out of the tight weekly intra-day trading range of $3.46 per barrel. It, however, faced resistance at the 50-day moving average.
CBN releases new exchange rate
Legit.ng earlier reported that the Central Bank of Nigeria (CBN) released new official exchange rates for buying and selling the US dollar as the naira showed mixed performance across currency markets.
The move comes amid sustained demand from corporate foreign exchange users and ongoing efforts to stabilise the market with dollar interventions.
Trading data on Tuesday, August 26, 2025, showed the naira gaining marginally by ₦3 at the parallel market, closing at ₦1,547 per dollar.
Proofreading by Funmilayo Aremu, copy editor at Legit.ng.
Source: Legit.ng
