The Nigerian naira traded in a relatively narrow range against major currencies on Thursday, with the official market remaining broadly stable while the parallel market showed modest volatility against the British pound.
In the parallel market, the naira changed hands around the mid-N1,800s per pound, reflecting continued divergence between official and informal FX pricing. Dealers in Lagos and Abuja reported quotes fluctuating within a tight band, with no clear directional breakout during the session.
At the official Nigerian Autonomous Foreign Exchange Market (NAFEM), the naira continued to trade within its recent range of roughly N1,360 to N1,380 per dollar, underscoring a period of relative stability following earlier volatility earlier in the year. The pound cross mirrored broader dollar-naira dynamics, with sterling movement largely reflecting global currency shifts rather than a distinct naira-driven trend.
Market participants said liquidity conditions have improved compared with late Q1, supported by intermittent inflows from remittances and non-oil exports, alongside continued central bank activity aimed at clearing foreign exchange backlogs. However, they noted that liquidity remains uneven and subject to periodic tightening.
“The market is calmer than it was earlier in the year, but we are still seeing a dual-market structure with a persistent premium in the parallel market,” said one Lagos-based FX trader.
Analysts said the naira’s recent behaviour reflects a stabilisation phase rather than a sustained appreciation cycle. While inflows have helped reduce acute pressure on the currency, structural demand for foreign exchange continues to outweigh supply at the retail level.
Nigeria’s external reserves have shown modest recovery in recent months, though they remain sensitive to oil production levels and portfolio flow volatility. Traders continue to watch monthly inflows and central bank interventions for signals on near-term direction.
The Central Bank of Nigeria is expected to maintain its tight monetary stance at its next policy meeting, with the benchmark interest rate currently at historically elevated levels aimed at supporting price and exchange rate stability.
Despite improved sentiment compared with earlier in the year, analysts caution that the gap between official and parallel market rates remains a key indicator of underlying FX market stress.
