Naira Mixed as 9-Day Defensive FX Interventions Reduce Volatility

The naira closed the trading session on a mixed note in the foreign exchange markets, while the exchange rate movements were influenced by the Apex Bank’s nine consecutive days of selling US dollars to authorised dealer banks.

The naira depreciated near N1600 at the Nigerian Foreign Exchange Market (NFEM), which is the official exchange rate platform for the Central Bank. However, the naira appreciated by 1.29% in the parallel market to settle at N1,599.30.

In what appeared to have become a norm, participants in the currency market largely anticipated FX sales intervention rather than active interbank flows. To close the liquidity gap in the forex market, the CBN sold US dollars to banks all week.

According to TrustBanc, the CBN intervened for the ninth consecutive session yesterday, selling $100 million to ease demand pressure, bringing the total FX sales for the week to $280 million. Spot FX rates range between ₦1,590 and ₦1,623.24/$1.

Despite the muted demand, trades consistently occurred above the ₦1,600 handle as sellers attempted to offload inflows into the market tone remained offered, AIICO Capital Limited said in a note

The naira appreciated marginally by 24 bps week-to-date to close at ₦1,599.94/$1 from ₦1,603.78 per dollar. For the fifth consecutive week, Nigeria’s foreign external reserves reduced, falling below $38 billion.

Data from the CBN showed that Nigeria’s external reserves stood at $37.88 billion as of April 17, reflecting a weekly decline of approximately $111.2 million. The CBN is expected to sustain its market stabilization interventions in the near term, AIICO Capital Limited said following the latest report that showed net FX inflow eased.

Net foreign exchange inflows into the Nigerian economy declined to $4.79 billion in January 2025, down from $5.01 billion recorded in December 2024, representing a 4.4 percent drop, according to the latest data released. The Nigerian Autonomous Foreign Exchange Market (NAFEM) witnessed subdued activity throughout the week, characterized by cautious sentiment and minimal trading volumes.

Meanwhile, oil prices climbed over 3% on Thursday, driven by optimism around a potential U.S.-EU trade deal and newly imposed U.S. sanctions on Iran aimed at cutting its oil exports, heightening global supply concerns.

Brent crude rose by $2.11, or 3.2%, to settle at $67.96 per barrel, while U.S. West Texas Intermediate (WTI) crude advanced $2.21, or 3.54%, to $64.68. Gold prices dipped as investors took profits following a strong rally the previous day. Despite the decline, gold remained above the $3,300 mark, supported by a weaker U.S. dollar and persistent U.S.-China trade tensions.

Spot gold fell 0.5% to $3,326.51 per ounce after reaching a record $3,357.40, while U.S. gold futures edged down 0.2% to $3,339.90.

While the U.S. intensifies pressure through expanded Iranian oil sanctions, OPEC+ has reassured markets of its capacity to adjust output, stating it retains sufficient flexibility to enact supply reductions when necessary, analysts said. #Naira Mixed as 9-Day Defensive FX Interventions Reduce Volatility MTN Nigeria Net Loss Grows by 192% to N400 billion

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