Naira Gains Strength as Gap Between Official and Black Market Rates Narrows to Just N2

• The gap between the parallel market and official window finally closed   as the naira maintained a strong stance against the dollar last week
• At the end of last week, the naira appreciated by  69.3 basis points week-on-week to close at N1,528.56 to a dollar, and N1,530 in the black market
• The new rate shows the narrowing of the exchange rate gap in the FX market, easing speculative demand for the US dollar

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

The Nigerian currency, the naira, traded strongly against the US dollar last week as the gap between the official and black markets significantly closed to N2 by the end of trading on Friday, July 4, 2025.

Last week, the naira gained against the dollar in four out of the five trading sessions at the Nigerian Foreign Exchange Market (NFEM).

The naira maintains week-long gains against the USD

After five days of successive gains, the local currency’s spot rate dipped to N1,528.56 per dollar at NFEM, while the black market rate settled at N1,530.

Experts say the reduced gap would ease speculations, with the Central Bank of Nigeria’s (CBN) efforts to remove market distortions from the supply end.

The naira opened quietly, trading at N1,525 and N1,535, due to sell-offs from foreign portfolio investors (FPIs) and interbank traders positioning ahead of the apex bank’s OMO auction.

Naira vs dollar: What’s driving the surge?

Market Forces Africa reported that with sufficient volume, the FX rate settled below N1,530 per dollar midweek, supported by inflows from FPIs and oil-exporting companies.

AIICO Capital analysts disclosed that the naira stayed strong despite the absence of CBN’s intervention since June 20, 2025.

They reported that the fixings traded downward across sessions, showing organic strengthening of the local currency, with trades even settling below N1,500 per dollar.

At the end of the week, the naira appreciated by 69.3 basis points week-on-week to close at N1,528.56 to a dollar, while the foreign exchange reserves depreciated by $138.30 million to $37.181 billion, showing sustained demand and tight central bank supply.

Analysts at AIICO Capital said the naira is projected to strengthen on better dollar supply, stating that tariff-related and oil output risks could limit gains.

Crude oil price crash: Will the naira fall?

Data from the international market shows that oil prices slipped slightly on Friday, July 4, 2025, as investors anticipated the outcome of the OPEC+ meeting, where an oil production increase is expected.

The data showed that Brent crude dropped 50 cents, or 0.70% to sell at $$68.30, while US WTI also dipped 50 cents, selling at $66.50 per barrel.

However, gold prices surged and were on track for a weekly increase due to a weaker dollar and safe-haven demand.

Spot gold prices rose 0.3% to $3,336.39 an ounce.

Traders quote dollar at new rate as naira appreciates

Legit.ng earlier reported that the naira consolidated its gains against the US dollar in the foreign exchange market on Tuesday, July 1, 2025.

The local currency appreciated against the US greenback amid reduced demand pressures.

At the Nigerian Foreign Exchange Market (NFEM), the naira closed trading at N1,537 per dollar, from N1,532 the previous day.

Source: Legit.ng