Dollar Crashes Massively in Forex Markets as Naira Records Highest Appreciation

• The naira has recorded its highest gain in over 20 days against major currencies, including the US dollar
• Data from the Nigerian Foreign Exchange Market (NFEM) shows that the naira closed trading at N1,560 per dollar on Wednesday, June 4, 2025
• The N15 gain on Wednesday is the highest the naira has appreciated since May 20, 2025, in the FX market

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The Nigerian currency has recorded the highest gain in over 20 days against the US dollar.

The naira beat steep predictions, especially from the African Development Bank (AfDB), to emerge stronger in the foreign exchange markets.

The naira gains N15 in the FX market

According to data released by the Central Bank of Nigeria (CBN) on Wednesday, June 4, 2025, the naira recorded the highest appreciation in over 20 days.

The data shows that the local currency closed trading at N1,564, up from N1,579 per dollar.

The last time the naira rose this high in the forex market was on May 20, 2025, when it closed at N1,560 per dollar.

The current gain represents N15 appreciation against the US greenback.

Details from the Nigerian Foreign Exchange Market (NFEM) show that currency dealers quoted the dollar spot rate at a high of N1,577  and a low of N1,556.

Naira gains in the black market as experts predict better days

Also, data from the parallel segment of the foreign exchange market, known as the black market, shows that the naira appreciated to N1,630 per dollar from N1,632 the previous day. 

The new naira rate comes as analysts predict better days for the Nigerian currency based on the current reforms of the apex bank.

According to them, based on the CBN reforms, the naira is poised for a major rebound against the dollar.

“The naira will continue its resurgence if the CBN continues to sanitise the system,” Janet Ogochukwu, senior banker and economist, said.

According to Ogochukwu, the predictions of the African Development Bank (AfDB) that the naira will depreciate by six per cent in 2025 may not happen if the CBN puts things in place.

“This is not the first time international finance agencies have predicted doom for the naira. Is it not concerning that the likes of the UK’s The Economist did not release Nigeria’s forecast for 2025?

“This is to tell you that the naira is unpredictable in its surge against major currencies,” she said.

BusinessDay reports that analysts at Afrinvest Securities Limited estimated that the naira could maintain its current positive movement in June.

Impact of naira's appreciation

Nigeria's recent currency movement, where the naira appreciates against the US dollar, marks a significant shift in the country's economic landscape. The naira's rise reflects a stabilisation effort following CBN's interventions and policy reforms aimed at managing foreign exchange reserves.

While this change seems promising, its long-term impact on Nigeria’s economy and citizens requires a closer look.

For businesses, particularly those reliant on imported goods, this appreciation could lead to lower import costs, reducing overall prices. However, the benefits may not immediately trickle down to consumers, especially when considering inflation, which remains a concern.

The impact on food and fuel prices, essential to Nigerian households, remains uncertain, as price reductions could take time to materialise.

Mixed reactions over naira appreciation

Speaking with Legit.ng, a Lagos-based economist, Adebayo Olamide, noted that a rising inflation rate may overshadow the benefits of an appreciating naira.

He said:

“This is a welcome change, but it’s only one piece of the puzzle. Inflation remains high, and a stronger naira will not solve the structural issues plaguing our economy.”

On the other hand, a retail business owner in Lagos, Nkechi Okoro, expressed optimism in the reduction of prices of various items.

She said:

“We’ve seen some reduction in the prices of imported goods, and this could help ease things for consumers.”

While the naira’s appreciation provides a short-term boost, Nigeria must address its broader economic challenges, like inflation, unemployment, and infrastructure, to ensure lasting benefits for its citizens.

Forex reserves rise by $460 million

They anticipated that the naira would maintain similar performance across all forex markets.

Meanwhile, data from the CBN figures show that the reserves added $460 million or 1.2% from $38 billion at the beginning of May to $38.46 billion as of May 29, 2025.

The movement shows improved foreign exchange inflows, which allows the apex bank more buffer to sustain its FX interventions to strengthen the naira.

CBN releases new dollar rates to clear goods

Legit.ng earlier reported that CBN has increased the Customs foreign exchange rates for cargo clearance at Nigeria’s sea and airports.

The new rate comes amid the naira’s depreciation in the Nigerian foreign exchange market.

Data from the Customs trade portal shows that the apex bank increased the rate to N1,590.247 per dollar, up from N1,579.241.

The article was updated by the head of the business desk, Victor Enengedi, with additional information and comments from two people.

Source: Legit.ng