CBN Steps In, Naira Bounces Back: Dollar Supply Shock Lifts Official Rate
- The naira staged a remarkable comeback in the official and parallel markets on Monday, December 22, 2025
- The dollar exchange appreciated by 0.54% to close positively, showing a short-term easing of pressure
- Dealers attributed the rebound to renewed intervention by the CBN, which sold about N150 million to market players
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The naira recorded a notable recovery at Nigeria’s official foreign exchange window on Monday, December 22, strengthening against the US dollar as liquidity conditions improved.
Data from the official market showed the local currency appreciating by 0.54% to close at ₦1,456.56 per dollar, signalling a short-term easing of pressure that had weighed heavily on the currency in recent weeks.
Source: Getty Images
CBN injects $150 million to stabilise the market
Market operators linked the rebound largely to renewed intervention by the Central Bank of Nigeria (CBN), which stepped into the market with fresh dollar sales aimed at calming demand ahead of the year-end period.
The Central Bank sold an estimated $150 million to authorised dealers and deposit money banks last week, according to foreign exchange traders.
The intervention was designed to absorb pent-up demand for dollars and prevent excessive volatility in the official window.
Traders also disclosed that additional dollar sales may have taken place beyond officially captured figures, further supporting the spot exchange rate. This increased supply helped steady the market and reduce speculative demand, a recurring challenge in recent months.
Improved intraday trading signals
At Monday’s trading session, the naira touched an intraday high of ₦1,466 per dollar, a clear improvement from the ₦1,469 level recorded at the close of trading on Friday.
Even more striking was the intraday low of ₦1,431, at which some foreign payments were reportedly settled.
This marked a sharp contrast to the ₦1,460 level quoted at the same time in the previous session, highlighting the absence of intense demand pressure that had previously pushed rates higher.
Parallel market reflects positive sentiment
The improved sentiment was not limited to the official window. In the parallel market, the naira also firmed to around ₦1,466 per dollar, reflecting reduced strain across both regulated and informal segments of the foreign exchange market.
Currency dealers said the convergence in movement between the two markets suggests short-term confidence in the Central Bank’s ability to manage liquidity, especially as businesses and importers prepare for increased seasonal demand.
External reserves inch up
Nigeria’s external reserves also recorded a modest recovery following significant outflows linked to foreign payments last week.
Gross reserves rose slightly to $45.216 billion from $45.209 billion, offering some support to the Central Bank’s intervention capacity despite ongoing oil price fluctuations.
According to a report by Market Forces Africa, while the increase was marginal, analysts say it signals relative stability at a time when reserve levels remain under scrutiny by investors and credit rating agencies.
Oil prices provide additional support
Global oil prices climbed on Monday, adding another layer of support to Nigeria’s external position.
Prices jumped after the United States intercepted a third oil tanker linked to Venezuela and announced a total blockade of sanctioned Venezuelan oil shipments.
Tensions also rose following a Ukrainian drone strike on a Russian shadow fleet vessel in the Mediterranean.
Source: Getty Images
Brent crude for February delivery rose 2 per cent to $61.68 per barrel, while US WTI crude for January delivery gained 2.03 per cent to $57.67 per barrel.
With Venezuela accounting for about 1 per cent of global oil supply, analysts say sustained price gains could improve Nigeria’s dollar inflows if maintained.
Outlook remains cautiously optimistic
While the naira’s rebound offers short-term relief, analysts caution that sustained stability will depend on consistent dollar supply, improved export earnings, and disciplined demand management.
For now, the Central Bank’s intervention has delivered a temporary boost, easing pressure as the year draws to a close.
Naira suffers sharpest fall as dollar scarcity deepens
Legit.ng earlier reported that the Nigerian naira recorded its steepest depreciation in recent weeks at the official foreign exchange window, as persistent dollar shortages intensified pressure on the local currency.
Despite renewed intervention by the Central Bank of Nigeria, demand for foreign exchange continued to outstrip supply, pushing the naira to weaker levels against the US dollar.
Market signals now point more clearly to sustained foreign exchange stress, with liquidity constraints limiting the effectiveness of regulatory support and inflows failing to calm the market.
Proofreading by Kola Muhammed, copy editor at Legit.ng.
Source: Legit.ng
