By Stephen Simon
The naira is expected to remain largely stable against the United States dollar in the coming week, with foreign exchange traders attributing the outlook to sustained interventions by the Central Bank of Nigeria (CBN), improved dollar liquidity and continued inflows from exporters and foreign investors. Market participants say the currency has maintained relative stability despite global economic uncertainties.
Currency dealers said the CBN’s regular dollar sales to authorised dealers, alongside foreign exchange supplied by oil companies, exporters and portfolio investors, have helped keep demand and supply relatively balanced. They noted that the apex bank’s interventions have continued to reduce volatility in the foreign exchange market.
At the official market, the naira traded around N1,360 to the dollar, while it exchanged at about N1,425 in the parallel market. Traders expressed optimism that the exchange rate would remain within this range in the coming days, barring any major external shocks or unexpected demand pressures.
Financial analysts said the relative calm in the foreign exchange market reflects the impact of recent monetary and fiscal reforms aimed at improving liquidity and restoring investor confidence. They added that the gradual narrowing of the gap between the official and parallel market rates has also strengthened confidence among businesses and investors.
The outlook for the naira comes as other African currencies are also expected to remain largely stable. While Ghana’s cedi and Kenya’s shilling are projected to hold steady on the back of central bank support and foreign exchange inflows, Zambia’s kwacha is forecast to remain under pressure due to election-related uncertainty, and Uganda’s shilling is expected to strengthen on anticipated bond inflows.
Analysts, however, cautioned that Nigeria’s foreign exchange market remains vulnerable to global developments, including movements in crude oil prices, shifts in international capital flows and decisions by major central banks. They said these factors could influence foreign exchange supply and investor sentiment in the weeks ahead.
Despite these external risks, market operators expressed confidence that the CBN has sufficient policy tools to maintain stability in the near term. They said sustained reforms, improved foreign exchange inflows and prudent monetary management would remain critical to preserving confidence in the naira and supporting broader economic recovery.
