CBN Moves to Crash Dollar With $150 Million Amid Drop in Inflow, Naira’s Gain
- The Central Bank of Nigeria injected a lifeline to stabilise the foreign exchange market amid declining FX inflows
- Naira appreciates slightly in the foreign exchange market following CBN's intervention after recent volatility
- External reserves rise by $19.19 million, providing reassurance for the FX market's stability and support
The Central Bank of Nigeria has stepped in aggressively to stabilise the foreign exchange market, injecting an additional $150 million into the official window as FX inflows declined sharply and pressure on the naira intensified.
The intervention, executed through sales to banks and authorised dealers, came amid rising import demand and thinning dollar supply, conditions that had triggered sharp swings in the exchange rate over recent trading sessions.
Source: Getty Images
CBN steps up as inflows drop
Data shows that the total FX inflows into the Nigerian market fell by nearly 50 per cent week on week, dropping to about $730 million from the $1.46 billion recorded in the prior week
With inflows drying up, the CBN emerged as the single largest source of dollar supply, effectively cushioning the market against further volatility.
Foreign portfolio investors trailed exporters and the CBN in FX contributions, underscoring continued caution among offshore investors.
However, some relief came from non-bank corporate dollar inflows, which helped to moderate liquidity stress at the official window.
According to a report by Market Forces Africa, the combination of reduced inflows and heightened import activity had placed the naira under sustained pressure before the apex bank’s latest intervention.
Naira strengthens at official window
Following the $150 million FX sale, the naira recorded a modest but notable appreciation against the US dollar. At the close of trading on Tuesday, December 23, 2025, the local currency strengthened by ₦6.57 to settle at ₦1,449.99 per dollar at the official spot market.
During the session, the exchange rate traded within a relatively wide band of ₦1,455.50 to ₦1,447.50 per dollar, reflecting lingering demand pressures even as supply conditions improved.
Market participants attributed the naira’s gains largely to the CBN’s decisive action, noting that without the intervention, the currency could have faced sharper depreciation given current inflow dynamics.
External reserves edge higher
Updated figures from the CBN also revealed a slight improvement in Nigeria’s external buffers.
Gross external reserves rose by $19.19 million to $45.24 billion, pushing the year-to-date increase to 10.66 per cent.
The reserve build-up, though marginal, offers some reassurance to investors and traders about the central bank’s capacity to continue supporting the FX market if needed.
Global markets offer mixed signals
On the global front, oil prices edged higher as investors weighed stronger-than-expected US economic growth against potential supply disruptions linked to Venezuela and Russia.
Brent crude gained 72 cents, or 1.17 per cent, to settle at $62.30 per barrel, while US West Texas Intermediate rose 25 cents, or 0.43 per cent, to $58.26 per barrel.
Gold prices also advanced, supported by renewed safe-haven demand. Spot gold climbed 0.96 per cent to $4,488.47 per ounce, while US gold futures rose 1.09 per cent to $4,518.15.
Source: Getty Images
Analysts expect oil prices to remain underpinned by geopolitical supply risks, while gold is likely to stay firm as investors hedge against global economic uncertainty.
For Nigeria, sustained oil price support could provide some relief for FX earnings, easing pressure on the naira in the months ahead.
Dollar flood hits Nigeria: Forex inflows surge
Legit.ng earlier reported that Nigeria’s foreign exchange position received a major lift in 2025 as net dollar inflows into the economy climbed to $41.73 billion within the first eight months of the year.
Data from the Central Bank of Nigeria shows this represents a 12.3 percent year on year increase compared with $37.14 billion recorded in the same period of 2024.
-The stronger inflow has helped improve sentiment around the naira, which has faced intense pressure from import demand, capital outflows, and global tightening conditions over the past two years.
Source: Legit.ng
