The Nigerian naira strengthened in the parallel market, appreciating to N1,585/$1, while it slightly depreciated to N1,499.76/$1 at the official market. Traders attributed the shift to declining dollar demand and new CBN policies. Meanwhile, global currency markets remain volatile amid U.S. tariff policies and Federal Reserve inflation concerns.
The Nigerian naira showed mixed performance in the foreign exchange market, appreciating in the parallel market while weakening at the official exchange window. The naira strengthened to N1,585/$1 in the black market, gaining N20 from its previous rate of N1,605/$1. However, at the FMDQ official market, it depreciated slightly to N1,499.76/$1 from N1,498.95/$1.
Currency traders attributed the naira’s improvement in the parallel market to a decline in dollar demand, partly due to the Chinese New Year holiday and the Central Bank of Nigeria’s (CBN) foreign exchange policies. Some traders also sold off their dollar reserves, increasing market supply.
In response to market dynamics, the CBN introduced new Bureau de Change (BDC) guidelines aimed at improving foreign exchange transactions. These guidelines streamline currency exchange processes and ensure compliance with new automated systems to enhance market efficiency.
Meanwhile, global currency trends indicate that the U.S. dollar remains strong, with trade tariff disputes impacting inflation and economic outlooks. Former U.S. President Donald Trump proposed a 25% tariff on Canadian and Mexican imports, while Washington imposed a 10% tariff on China, triggering retaliatory measures.
Federal Reserve officials warned that these tariffs could fuel inflation, forcing the Fed to maintain higher interest rates for an extended period. The global financial market remains volatile, with analysts closely monitoring economic indicators for future rate adjustments.
As currency fluctuations continue, traders and investors are watching the CBN’s response and broader economic policies that may impact Nigeria’s forex market.
