Naira Falls To N1,629/$ Despite $668m CBN Intervention
The naira depreciated to ₦1,629 per dollar in the Nigerian Foreign Exchange Market (NFEM) on Monday, despite a $688.8 million intervention by the Central Bank of Nigeria (CBN).
According to data published by the apex bank, the indicative exchange rate for the naira rose to ₦1,629 per dollar, up from ₦1,600 per dollar last Friday, reflecting a ₦29 depreciation.
Similarly, the naira weakened in the parallel market, falling to ₦1,570 per dollar from ₦1,565 per dollar last weekend.
As a result, the gap between the parallel market rate and the NFEM rate widened to ₦59 per dollar, compared to ₦35 per dollar the previous week.
The naira also depreciated by 2.4% at the Nigerian Autonomous Foreign Exchange Market (NAFEM) window and by 2.6% in the parallel market in March, compared to the previous month.
The latest Afrinvest Monthly Market Report, titled “Analysing Global and Nigerian Economies & Financial Markets,” showed that the naira dropped to ₦1,536.82/$ at the NAFEM window and ₦1,530.00/$ in the parallel market.
AIICO Capital, in its March macroeconomic market report, confirmed that the naira came under significant demand pressure. The report noted, “The naira experienced considerable depreciation in March 2025 due to persistent demand pressures in the Nigerian foreign exchange market.”
“Despite a substantial dollar intervention by the Central Bank of Nigeria, totaling $668.8 million, the naira weakened by 2.97% month-on-month, closing at ₦1,536.82/$ from ₦1,492.49/$ at the beginning of the month,” AIICO Capital added.
During this period, demand remained high, particularly from foreign portfolio investors and local corporations. The parallel market mirrored this trend, depreciating by around ₦43.50/$ to ₦1,536.00/$.
While liquidity improved mid-month through CBN interventions, demand continued to exceed supply. In the final week, despite continued CBN dollar sales and a slight appreciation of 0.5 bps, the naira remained under pressure. On a quarterly basis, the naira depreciated by 7 bps at the NFEM window, while external reserves declined by about $110 million to $38.31 billion.
Looking ahead, AIICO Capital suggests that the CBN is likely to continue supporting liquidity to stabilize the naira in the near term. However, the report warns that global risks—such as US tariffs and retaliatory measures—could spur volatility and capital flight.
In the past week, the naira experienced heightened volatility in the interbank Nigerian Foreign Exchange Market. Early in the week, it remained relatively stable, trading between ₦1,525 and ₦1,535/$, supported by consistent CBN interventions and moderate offshore inflows.
However, by midweek, a sharp reversal occurred as offshore demand surged, compounded by weakened oil prices due to OPEC+’s supply increase and global risk-off sentiment following tariff announcements from former US President Trump. This led to strong FX demand pressure and limited supply, pushing the naira to as high as ₦1,570/$. Despite the CBN’s intervention, the naira depreciated by 1.97% week-on-week, closing at ₦1,567.02/$, and foreign reserves declined by $149 million to $38.15 billion.
