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The naira has strengthened against the United States dollar at the Nigerian Foreign Exchange Market (NFEM), closing the week with further gains despite a sharp decline in foreign exchange turnover.
The local currency settled at N1,322.50/$ on Friday, September 4, holding the same rate as the previous session. The figure represents an improvement from the N1,335.50/$ recorded at the beginning of the week, marking a N13 gain or a 0.97 per cent appreciation between Monday and Friday.
The weekly rise extended the naira’s recent positive movement in the official market, even as trading activity declined significantly. Data from the Central Bank of Nigeria (CBN) showed that foreign exchange turnover on the NFEM dropped by about $1.05 billion during the week.
Turnover fell from $3.19 billion recorded in the previous week to $2.14 billion in the latest period, indicating reduced activity in the official foreign exchange market.
The naira began the week at N1,335.50/$ on August 31 before gaining strength to N1,329/$ on September 1. It appreciated further to N1,324.50/$ on September 2 before settling at N1,322.50/$ by the end of the week.
Market analysts have continued to monitor the currency’s performance as policymakers seek to maintain stability in the foreign exchange market through improved liquidity, tighter monetary measures and efforts to attract more inflows.
The latest movement comes after months of volatility in the naira’s exchange rate, with businesses and consumers closely watching developments in the official and parallel markets.
While the weekly appreciation signals improved performance for the currency, the decline in NFEM turnover raises questions about the depth and sustainability of the recent gains, particularly as demand for foreign exchange remains a key factor influencing exchange rate movements.
