Naira Holds Strong as CBN Pumps $150 Million into Banks, Foreign Reserves Hit $40bn

• The naira traded strongly in the foreign exchange market recently, with analysts predicting more wins for the local currency
• The naira’s performance was buoyed by CBN’s intervention, which resulted in a $150 million intervention
• The development led to the naira’s competitive performance in the official forex window recently

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

The Nigerian naira ended the week on a stable note at the Nigeria Foreign Exchange Market (NFEM) following a significant dollar intervention by the Central Bank of Nigeria (CBN).

CBN data revealed that the official exchange rate closed at N1533.56 per dollar on Friday, barely changed from the previous day’s N1533.73.

Dollar sales power stability

During intraday trading, the currency hit a high of N1536 and a low of N1532.50, showcasing its resilience in a market that has seen turbulent swings in recent months.

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The CBN’s latest intervention saw $150 million injected into authorised dealers, including major banks such as Access Bank, Zenith Bank, and United Bank for Africa (UBA).

This supply was further boosted by inflows from foreign portfolio investors who recently participated in the CBN’s OMO bill auction.

These combined efforts helped maintain strong liquidity, keeping speculative pressures at bay.

Foreign reserves break $40 billion

In a major confidence boost for the market, Nigeria’s foreign reserves grew by $800.51 million week-on-week, reaching $40.16 billion.

This marks one of the highest reserve levels in recent times, strengthening the CBN’s ability to defend the naira in the event of market shocks.

Analysts note that higher reserves often act as a psychological anchor for traders, signalling that the apex bank has enough firepower to meet market demands.

Analysts predict sustained gains

Experts at Cordros Capital Limited expressed optimism about the currency’s outlook, citing expectations of sustained FX liquidity.

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They believe elevated yields in Nigeria’s OMO market, combined with a weaker US dollar, will keep attracting foreign portfolio inflows in the near term.

Improved confidence and fewer incentives for speculative trading in the naira are also expected to reinforce steady inflows from domestic sources.

What this means for Nigerians

For businesses and individuals, a stable naira brings much-needed predictability in pricing and planning.

Importers, exporters, and even everyday shoppers stand to benefit if the trend continues — especially with inflation still weighing heavily on households.

However, market watchers caution that maintaining this stability will require consistent interventions and economic policies that sustain investor trust.

Dollar falls at official window

Legit.ng earlier reported that the Nigerian naira recorded a marginal gain against the US dollar at the Nigerian Foreign Exchange Market (NFEM), supported by sustained liquidity and reduced funding pressure.

Data from the Central Bank of Nigeria (CBN) revealed that the naira appreciated to N1533.73 per dollar, up from the previous day's N1534.43, marking a modest but significant gain in a tightly controlled market.

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In intraday trading, the naira fluctuated between a high of N1535.99 and a low of N1531.99, before settling at N1535.

Source: Legit.ng