Naira trades flat as external reserves climb to highest since 2009

The naira depreciated marginally across foreign exchange (FX) market segments on Thursday amid weaker dollar inflows, even as Nigeria’s external reserves climbed to their highest level since 2009.

Data published by the Central Bank of Nigeria (CBN) showed that the naira weakened by N3.23 to close at N1,363.30 per dollar on Thursday at the Nigerian Foreign Exchange Market (NFEM), compared with N1,360.07 quoted on Wednesday, representing a 0.24 percent depreciation.

At the parallel market, also known as the black market, the local currency closed at N1,403 per dollar, losing N3 or 0.21 percent from N1,400 per dollar recorded previously. The spread between the official and parallel market rates remained unchanged at N40 per dollar.

Nigeria’s external reserves, which provide the CBN with the buffer to support the naira and meet external obligations, continued their upward trajectory, rising to $50.96 billion as of June 17, 2026. The reserve level is the highest since 2009 and represents a year-on-year increase of $13.22 billion, or 35.03 percent, from $37.74 billion recorded on June 17, 2025, according to data published on the CBN’s website.

Although Thursday’s data on total turnover and the number of deals at the NFEM were not available at the time of reporting, activity in the market had weakened a day earlier. The number of deals declined to 359 on Wednesday from 306 recorded two days earlier, while total turnover dropped sharply to $292.72 million from $544.22 million on Tuesday.

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However, activity at the interbank FX market strengthened. The number of deals rose to 85 on Thursday from 74 on Wednesday, while total turnover increased by 28.8 percent to $69.92 million from $54.29 million.

Meanwhile, the International Monetary Fund (IMF) reiterated its support for Nigeria’s commitment to a flexible exchange rate regime, noting that foreign exchange interventions could play a complementary role under certain circumstances.

The Fund, however, urged the authorities to reduce reliance on foreign portfolio inflows that carry rollover risks and to gradually phase out the remaining exchange restrictions, capital flow management measures and multiple currency practices as conditions permit.

According to the IMF’s latest assessment, the naira remains undervalued relative to economic fundamentals. The Fund’s External Balance Assessment (EBA)-lite model estimated that Nigeria’s Real Effective Exchange Rate (REER) is undervalued by about 25.6 percent.

To help narrow that gap, the IMF recommended slowing the pace of reserve accumulation when appropriate, allowing greater two-way movement in the exchange rate, and sustaining fiscal and structural reforms.

The Fund also called on the CBN to publish the broad principles guiding its foreign exchange intervention framework, arguing that greater transparency would strengthen market confidence and improve the functioning of the FX market.

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.