Naira extends gains after CBN releases revised foreign exchange manual

The naira strengthened further against the dollar across foreign exchange (FX) market segments on Tuesday, a day after the Central Bank of Nigeria (CBN) released its revised Foreign Exchange Manual aimed at improving transparency, consistency, and efficiency in the country’s FX market.

The local currency’s appreciation was supported by improved liquidity in the Nigerian Foreign Exchange Market (NFEM) window, alongside growing external reserves that have continued to bolster confidence in the market.

Data published by the CBN showed that the naira appreciated by N5.74 at the official market, with the dollar quoted at N1,361.05 on Tuesday compared to N1,366.79 on Monday, representing a 0.42 percent gain.

Although NFEM turnover and transaction figures for Tuesday were not available at the time of filing this report, activity in the market strengthened significantly on Monday. The number of deals rose by 19.88 percent to 392 transactions from 327 recorded on Friday. Similarly, turnover climbed to $795.55 million on Monday, representing a 32.88 percent increase from the $598.69 million recorded at the close of trading on Friday.

Activity at the interbank segment showed mixed performance. The number of deals increased marginally by 2.4 percent to 168 transactions on Tuesday from 164 deals recorded on Monday. However, total turnover at the interbank market declined by 4.56 percent to $169.82 million from $177.93 million recorded in the previous session.

In the parallel market, commonly referred to as the black market, the naira remained unchanged at N1,385 per dollar. As a result, the gap between the official and parallel market exchange rates widened to N24 per dollar on Tuesday from N19 recorded on Monday.

Nigeria’s external reserves, which provide the CBN with the capacity to support the local currency and meet external obligations, have continued to rise steadily. Data published on the apex bank’s website showed that reserves increased to $49.80 billion as of June 1, 2026, from $48.32 billion recorded on May 7, 2026.

The gains in the local currency came shortly after the CBN unveiled the revised Foreign Exchange Manual, a document designed to provide a comprehensive guide for Authorised Dealers, Authorised Buyers, investors, and the general public on the procedures governing foreign exchange transactions in Nigeria.

According to the apex bank, the revised manual codifies the procedures, documentation requirements, compliance standards, and reporting obligations necessary for the effective management and utilisation of foreign exchange in line with Nigeria’s broader economic and development objectives.

Related News

The CBN noted that the manual serves both as a regulatory instrument and a policy guide aimed at enhancing transparency, accountability, and efficiency in the foreign exchange market.

The bank said the revised framework seeks to promote order, consistency, and transparency in the inflow and outflow of foreign exchange, establish clear documentation and reporting standards to ensure accountability and traceability of transactions, and support national economic priorities by ensuring that foreign exchange is channelled toward productive and essential uses.

Under the new guidelines, Authorised Dealers are permitted to engage in spot foreign exchange transactions among themselves, with customers, and with the CBN in any acceptable foreign currency for delivery within a maximum of two business days (T+2). The manual stipulates that all interbank spot transactions must be executed through an electronic trading system approved by the CBN.

The apex bank further directed Authorised Dealer banks to maintain adequate credit, settlement, and risk limits for all counterparties participating on the approved trading platform. Banks are also required to strictly comply with Net Open Position (NOP) limits and ensure that no breaches occur at the close of any trading session.

The manual also allows Authorised Dealer banks to conduct spot foreign exchange transactions with non-resident customers and clients in any acceptable foreign currency, provided settlement is completed within the T+2 framework. Where a bank is selling foreign exchange to a customer or client, the transaction must be supported by appropriate and verifiable documentation and must comply with all applicable regulations.

In addition, the CBN stressed that all spot foreign exchange transactions will remain subject to prevailing regulatory requirements, anti-money laundering and combating the financing of terrorism (AML/CFT) rules, as well as reporting obligations prescribed by the Central Bank and other relevant authorities.

The revised manual also provides guidance on forward contracts, describing them as agreements to purchase or sell foreign currency at a predetermined exchange rate for delivery on a future date. According to the CBN, such contracts must be reflected in a bank’s foreign currency trading position from the deal date and must be supported by appropriate documentation and regulatory compliance requirements.

Hope Moses-Ashike

Hope Moses-Ashike is an Associate Editor, Banking and Finance, with more than a decade of experience reporting on Nigeria’s financial system and broader economy. She closely tracks market movements, monetary policy decisions, company disclosures, regulatory actions, economic indicators, and global developments, and interprets what they mean for businesses, investors, policymakers, and households. Her reporting helps readers understand complex issues such as inflation trends, foreign exchange market dynamics, interest rate decisions, bank performance, and investment risks. She also covers major international events and periodically travels to Washington, D.C., to report on the World Bank/IMF Spring and Annual Meetings. Her dedication to financial journalism has earned her multiple recognitions and invitations to high-level professional development programmes. She is an alumna of the International Visitors Leadership Programme (IVLP) in the United States and holds an Advanced Financial Journalism Certificate from the Press Association Training in London, UK. Her other notable achievements include completing the Lagos Business School CMC Programme, the Bloomberg Media Africa Initiative Programme, and a Master Class in Journalism at Rhodes University in South Africa.