Naira slides as reserves rise to $46bn

The naira weakened against the US dollar at the official foreign exchange window on Friday, pressured by FX payment obligations that strained market liquidity, despite a modest increase in Nigeria’s external reserves. Data from the Central Bank of Nigeria (CBN) showed that the spot exchange rate depreciated by 0.21 per cent to close at N1,421.63 […]

The naira weakened against the US dollar at the official foreign exchange window on Friday, pressured by FX payment obligations that strained market liquidity, despite a modest increase in Nigeria’s external reserves.

Data from the Central Bank of Nigeria (CBN) showed that the spot exchange rate depreciated by 0.21 per cent to close at N1,421.63 per dollar at the official window. By the end of the trading session, the naira had shed 0.72 per cent overall.

At the parallel market, the currency fell further to about N1,475 per dollar, underscoring persistent demand pressures and deep-seated structural imbalances in the FX market.

Analysts said bearish sentiment on the naira has intensified amid global geo-economic uncertainties, particularly concerns around the United States’ increasingly protectionist trade stance. Some market projections warn that upcoming financial market developments — including potential capital gains tax adjustments — could trigger sell-offs in naira-denominated assets, adding to pressure on the currency.

Cowry Asset Management Limited noted that the naira is likely to remain under pressure in the near term due to sustained FX demand and structural challenges, although rising external reserves could offer limited support.

Nigeria’s external reserves edged up by 0.20 per cent to $45.99 billion, supported by steady crude oil receipts, improved non-oil inflows, and a sustained trade surplus.

Meanwhile, global oil prices settled at their highest levels in more than a week on Friday following heightened geopolitical tensions. Prices climbed after U.S. President Donald Trump announced tougher sanctions on vessels transporting Iranian oil and revealed that a naval “armada” was heading toward Iran, raising fears of supply disruptions.

Brent crude traded at $64.50 per barrel, while U.S. West Texas Intermediate (WTI) rose to $59.78 per barrel, reversing earlier declines linked to easing U.S.–Europe trade tensions and tariff concerns.