CBN Injects $197.7m as Naira Slides to N1,600/$1 Amid Global Turmoil

In a bid to stabilize the foreign exchange market and cushion the impact of global economic headwinds, the Central Bank of Nigeria (CBN) has injected $197.71 million into the foreign exchange (FX) market. The intervention, carried out on Friday, April 4, 2025, comes as Nigeria’s official exchange rate plummeted to N1,600/$1, its weakest level in four months.

The CBN’s latest move was confirmed in a statement released on Saturday by Dr. Omolara Omotunde Duke, Director of the Financial Markets Department. The statement reaffirmed the apex bank’s commitment to ensuring adequate liquidity and maintaining orderly market functioning.

“In line with its commitment to ensuring adequate liquidity and supporting orderly market functioning, the CBN facilitated market activity on Friday, April 4, 2025, with the provision of $197.71 million through sales to Authorized Dealers.

This measured step aligns with the Bank’s broader objective of fostering a stable, transparent, and efficient foreign exchange market,” Dr. Duke stated.

This strategic intervention comes amid heightened volatility in global financial markets, sparked by a wave of new import tariffs imposed by the United States on several trading partners.

The protectionist measures—part of the Trump administration’s so-called “Liberation Day” economic policy—have sent shockwaves through global trade channels, prompting selloffs in emerging market assets.

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For oil-exporting nations like Nigeria, the tariffs have been particularly consequential. Crude oil prices have tumbled over 12%, falling below $65.50 per barrel, well below the $75 benchmark set in Nigeria’s 2025 budget. As crude remains Nigeria’s largest source of foreign earnings, the price slump has exerted pressure on the country’s FX reserves and exchange rate stability.

According to CBN trading data, the naira closed at N1,600/$1 on Friday, reflecting a 1.9% depreciation from the previous day’s rate of N1,569/$1. The naira has now weakened by 3.9% in just the first four days of April, having closed March at N1,537/$1.

Intra-day trading showed sharp volatility, with the naira touching a high of N1,625 and a low of N1,519 to the dollar. The NFEM (Nigerian Foreign Exchange Market) average rate also slumped to N1,567/$1, its lowest since December 4, 2024, when the naira briefly hit N1,608/$1.

Despite the turbulence, the CBN emphasized its readiness to continue monitoring both domestic and global market trends closely. The apex bank expressed confidence in the robustness of Nigeria’s foreign exchange management framework, which it said is designed to adapt to changing macroeconomic realities.

Furthermore, the CBN reminded all Authorized Dealers to strictly comply with the Nigeria FX Market Code, which mandates transparency, fairness, and integrity in all FX dealings.

“We urge all market participants to uphold the highest standards in their dealings with clients and counterparties,” the statement added.

The CBN’s intervention is part of broader efforts to sustain investor confidence and curb speculative activity in the FX market. Market watchers believe that the bank may consider additional foreign currency forward sales and other liquidity tools if pressure on the naira persists in the coming weeks.

As the global economy adjusts to a new wave of trade protectionism and Nigeria grapples with declining oil revenues, all eyes remain on the CBN’s next moves to maintain FX market stability and restore confidence in the naira.