By Seun Ibiyemi
The naira posted a positive performance in the week ended Friday, July 3, 2026, strengthening against the United States dollar at the official foreign exchange market and maintaining relative stability in the parallel market, reinforcing growing confidence in Nigeria’s foreign exchange reforms.
Data from the Nigerian Foreign Exchange Market (NFEM) showed that the local currency closed the week at about ₦1,370 per dollar, appreciating from around ₦1,385 at the beginning of the week as improved foreign exchange liquidity and stronger market confidence supported demand and supply dynamics.
The official market witnessed a steady appreciation through the week, with the naira gaining from ₦1,376 per dollar at the end of June to approximately ₦1,370 per dollar by Friday, reversing losses recorded in the previous week.
At the parallel market, the local currency traded within a relatively narrow range, closing between ₦1,390 and ₦1,395 per dollar, reflecting improved market liquidity and a narrower gap between official and unofficial exchange rates compared with previous periods.
READ ALSO:Naira holds firm, trades at ₦1,374.18/$ in official market
Analysts attributed the week’s performance to sustained foreign exchange reforms by the Central Bank of Nigeria (CBN), improved dollar liquidity, stronger external reserves and reduced speculative demand in the foreign exchange market.
The stability of the naira also coincided with continued growth in Nigeria’s external reserves, improved crude oil production and increased foreign exchange inflows, factors that have strengthened the country’s external position and enhanced investor confidence.
Market operators noted that the convergence between the official and parallel market rates has continued to improve transparency in the foreign exchange market while reducing opportunities for arbitrage.
Despite the encouraging performance, analysts cautioned that sustaining exchange rate stability would require continued inflows from oil exports, foreign portfolio investments and diaspora remittances, alongside disciplined monetary and fiscal policies.
They also pointed to global oil prices, geopolitical developments and domestic political activities ahead of the 2027 general elections as key factors that could influence foreign exchange market sentiment in the months ahead.
Looking ahead, most market analysts expect the naira to remain broadly stable in the near term, supported by healthy external reserves, improved foreign exchange liquidity and ongoing CBN interventions aimed at reducing volatility in the market.
The week’s performance further underscores the relative stability the naira has recorded in recent months, although economists maintain that sustained exchange rate strength will ultimately depend on Nigeria’s ability to boost non-oil exports, attract long-term foreign investment and deepen domestic production to reduce import dependence.
