Naira slides to N1,606/$1 at official market amid liquidity strain

The naira depreciated to N1,606.00 per dollar at the official foreign exchange market on Tuesday, April 22, 2025, according to data published on the Central Bank of Nigeria (CBN) website.

This represents a marginal decline from the N1,600.50/$1 recorded on Thursday, April 17, 2025, the last trading day before the Easter holidays.

The currency’s latest performance reflects a loss of N5.50 or 0.34% over the four-day holiday period, underscoring persistent pressure on the local unit amid ongoing liquidity concerns and strong demand for the U.S. dollar.

In the parallel market, commonly referred to as the black market, the naira also weakened slightly, exchanging at N1,615/$1 on Tuesday compared to N1,610/$1 before the Easter break.

This depreciation of N5 was confirmed by a Bureau De Change (BDC) operator in the popular Wuse Zone 4 market in Abuja.

The sustained gap between the official and parallel market rates highlights the enduring challenges facing Nigeria’s foreign exchange management, despite recent policy efforts by the CBN to unify exchange rates and stabilize the currency.

Financial market analysts have attributed the naira’s weakening to a cocktail of factors, including restricted dollar inflows during the holidays, speculative buying activities, and a perceived delay in intervention from the CBN.

READ ALSO: Naira slides to N1,600.50/$1 amid persistent FX market volatility

“The fact that the naira weakened across both official and parallel markets after the holidays indicates lingering concerns over FX liquidity,” said Raheem Obadofin, a Lagos-based forex trader. “Market participants are still cautious, and demand continues to outpace supply,” he added.

Despite several measures introduced by the apex bank in recent months — such as foreign currency injections and aggressive efforts to clear the FX backlog — the naira remains vulnerable to pressure on the supply side.

The latest slide raises fresh concerns for Nigeria’s heavily import-dependent economy, where consumers and businesses are already grappling with high inflation.

Importers, many of whom depend on the parallel market due to limited access to official channels, now face even steeper costs in sourcing foreign currency, further driving up the prices of goods and services.

Analysts suggest that the CBN will likely ramp up its interventions in the coming days to defend the naira and attempt to close the widening gap between the official and parallel market rates.

BDC operators, for their part, have been vocal in calling for more consistent support from the CBN to stabilize the market.

Experts believe that only sustained policy reforms, improved dollar inflows through non-oil exports and foreign investments, and better overall FX management will secure long-term exchange rate stability for Africa’s largest economy.