Naira Breaks N1,400/$1 Barrier on Official Market After Over a Year

Nigeria’s naira has traded below the N1,400 to the dollar mark on the official foreign exce market for the first time in over a year, marking a key psychological and market milestone for the local currency.

Data from the Central Bank of Nigeria showed that the Nigerian Foreign Exce Market rate strengthened to N1,396.99/$1 on Thursday, improving from N1,400.48/$1 recorded on Wednesday. The movement confirms the naira’s return below the N1,400/$1 threshold after a prolonged period of trading above that level.

Intraday trading on Thursday reflected increased volatility but overall strength, with the naira touching a high of N1,400/$1 and a low of N1,367/$1 before closing at N1,385/$1. The performance capped a steady appreciation trend recorded throughout the week.

Earlier in January, the currency had traded as weak as N1,422.07/$1 on January 22 and N1,421.63/$1 on January 23. It later improved to N1,418.95/$1 on Monday, N1,401.22/$1 on Tuesday, and N1,400.47/$1 on Wednesday before decisively breaking below N1,400/$1 on Thursday.

The appreciation was also reflected in the parallel market. According to Cowry Asset Management Limited, the naira strengthened by 1.06 per cent to N1,454/$1, indicating improved sentiment across both the official and informal segments of the foreign exce market.

Commenting on the development, the Chief Executive Officer of CFG Advisory, Tilewa Adebajo, noted that the gap between official and parallel market rates has continued to narrow. He said the current premium is now around six to seven per cent, a sharp decline from the 64 per cent spread recorded in 2022.

Analysts attribute the naira’s recent ility to improved foreign exce supply, better liquidity conditions, and sustained reforms in the FX market. Market watchers expect the currency to continue trading within a more predictable range in the near term, provided current supply dynamics are maintained.