Tension in FX market as new CBN rate emerges, naira struggles to hold ground

• The Nigerian currency faced a renewed volatility in the Nigerian Foreign Exchange Market as demand pressures resurfaced
• The slight naira slide prompted the Central Bank of Nigeria (CBN) to intervene with $100 million injection
• The move aims at boosting liquidity and stabilise pricing as Nigeria heads into the peak of holiday-related foreign currency transactions

Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.

Nigeria’s foreign exchange market opened the week on a tense note as the naira weakened further despite a fresh $100 million intervention by the Central Bank.

The move, aimed at calming rising demand for dollars at the official window, did little to stop renewed pressure on the local currency.

According to the latest figures released by the CBN, the naira reached an intraday high of N1457 to the dollar at the Nigeria Foreign Exchange Market.

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This marked a slight dip from the previous day’s rate trading session and signaled lingering strain from year-end import demands and the activities of multinationals repatriating funds.

CBN sells FX to authorised dealers

The bank’s intervention involved selling $100 million through Access Bank, UBA, Zenith Bank and other authorised dealers.

The goal was to boost liquidity and stabilise pricing as Nigeria heads into the peak of holiday-related foreign currency transactions.

Yet, the impact was short-lived, and the naira continued to feel the weight of rising dollar appetite.

Naira weakens despite CBN support

By Monday’s close, the official rate at the NAFEM window stood at N1,451.86 per dollar.

This represented a 0.10 percent depreciation, showing that the market still leans heavily on the demand side with limited supply to match it.

Traders say most of the pressure comes from importers racing to clear shipments before year-end and international firms moving funds offshore ahead of quarterly reporting cycles.

While the official market showed signs of strain, the parallel market held steady at N1,463 per dollar.

This stability in the informal segment, despite turbulence at the official window, highlights the complicated and sometimes unpredictable nature of Nigeria’s currency landscape.

The widening contrast between regulated and informal exchange rates continues to raise concerns among analysts.

Some believe the duality encourages speculation, while others argue it reflects the fragmented structure of the FX ecosystem.

Reforms set to reshape the FX market by 2026

Industry watchers expect the gap between the two markets to close gradually.

One reason is the CBN’s ongoing reform that has drastically reduced the number of licensed Bureau de Change operators to just 82 nationwide.

Experts have predicted that the Nigerian currency will finish 2025 at N1,400 per dollar.

Meanwhile, Janet Ogochukwu, senior banker and economist, told Legit.ng that the naira can sustain the current barrage of high dollar demands in the FX market.

“For now, Nigeria’s forex reserve position is robust at over $45 billion, the highest in six years. Yes, I believe the naira can survive and hold its position against high demand,” she said.

The plan, according to industry sources, is to streamline the market and improve transparency.

CBN to increase dollar interventions

Market intelligence suggests that from 2026 the CBN will begin supplying dollars directly to the informal segment.

According to Market Forces Africa, the move is designed to help Nigeria discover a more realistic pricing structure for the naira and reduce volatility driven by speculation.

For now, the FX market remains sensitive, and investors are watching closely as the CBN battles to stabilise the currency.

With holiday spending, import settlements and multinational cash movements all converging, the weeks ahead may determine how firmly the naira can hold its ground before the new year.

CBN clarifies cash withdrawal limits on dollar accounts

Legit.ng earlier reported that CBN issued a new directive that immediately affects how banks manage cash withdrawals, especially for customers with dollar accounts.

While the revised cash withdrawal policy set strict weekly limits for naira transactions, the CBN made it clear that these limits did not apply to dollar withdrawals or other foreign currency transactions.

Dollar drops in value as naira soars in official and parallel markets, reserves hit $44.67bn

The updated cash policy would take effect on January 1, 2026. Under the new rule, individuals could only make a maximum cash withdrawal of five hundred thousand naira per week across all channels, including ATMs, POS points and over-the-counter transactions.