The Naira struggled against the US dollar this week, ending ₦1,454/$1 on Friday, as rising festive-season demand intensified pressure on the market.
After weeks of stability, importers, retailers, and consumers rushed to secure dollars ahead of Christmas and New Year celebrations.
Festive Season Push Naira Pressure
On Monday, the Naira traded at ₦1,450.01/$1, then slipped slightly to ₦1,447/$1 on Tuesday, before dropping further to ₦1,447.5/$1 on Wednesday.
By Thursday, it had depreciated to ₦1,449/$1, and finally closed the week weaker at ₦1,454/$1 on Friday.
Meanwhile, traders in Abuja’s parallel market pushed rates to ₦1,472/$1, highlighting the widening gap between official and market rates.
Market Forces At Play
Analysts explain that year-end spending drives foreign exchange demand, straining the Naira.
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A bureau de change operator in Wuse Zone 4 told newsmen that, despite CBN efforts, speculative trades and increased import activity continue to weigh on the currency.
Interestingly, last week the Naira showed signs of recovery, opening ₦1,452/$1 and closing ₦1,446.9/$1, but the festive rush quickly reversed that momentum.
Meanwhile, Nigeria’s foreign reserves rose modestly to $45.04 billion, giving the CBN more room to intervene if necessary.
Policy Response And Outlook
The CBN is finalising a revised Foreign Exchange Manual to improve transparency, tighten oversight, and make the FX market more predictable.
Earlier reforms, such as the Nigerian Foreign Exchange Code, already strengthened ethical conduct among authorised dealers.
Furthermore, the Federal Government’s 2026–2028 Medium-Term Expenditure Framework projects ₦1,512/$1, signalling policymakers’ acknowledgement of current market realities.
As November ended, the Naira traded slightly weaker at ₦1,446.9/$1 compared with ₦1,438/$1 at the start of the month, reflecting persistent volatility in the FX market.
