Nigeria’s currency, the naira, remained largely stable against the US dollar on Wednesday, August 5, as the country’s official foreign exchange market continued to show signs of stability despite stronger demand in the parallel market.
According to data released by the Central Bank of Nigeria (CBN), the naira closed at ₦1,362.55 per US dollar in the Nigerian Foreign Exchange Market (NFEM), the country’s official foreign exchange window. During trading, the currency fluctuated within a narrow range of ₦1,361 to ₦1,364.70, indicating relatively steady market conditions.
The official exchange rate is determined using a volume-weighted average of completed transactions and serves as the benchmark for government agencies, financial institutions, and many businesses across Nigeria.
However, the parallel market—commonly known as the black market—continued to trade at significantly higher levels. Currency dealers quoted the US dollar at approximately ₦1,415, leaving a difference of about ₦52 between the official and unofficial markets.
Market participants said the gap reflects persistent demand for foreign currency outside the official banking system, where some importers, travellers, and businesses continue to seek dollars due to supply limitations and faster access to cash.
Across major commercial centres, buying and selling prices varied slightly. Dealers reported purchasing dollars at around ₦1,410 and selling them for as much as ₦1,425, with rates depending on transaction size and location.
Financial analysts noted that the naira has traded within a relatively narrow range in recent weeks. They attributed the currency’s stability to ongoing interventions by the Central Bank of Nigeria, improved liquidity in the official market, and efforts to strengthen confidence in the country’s foreign exchange system.
Compared with earlier periods in July, the official exchange rate has remained close to the ₦1,360–₦1,365 band, while the parallel market has fluctuated between ₦1,405 and ₦1,425. The relatively stable movement suggests that authorities have managed to reduce sharp swings in the official market, although demand for foreign currency remains elevated.
For businesses involved in international trade, manufacturers importing raw materials, students paying tuition abroad, and Nigerians planning overseas travel, the difference between the official and parallel market rates continues to influence the overall cost of accessing foreign exchange.
Economists say Nigeria’s exchange rate performance will remain closely linked to foreign investment inflows, crude oil earnings, diaspora remittances, and the Central Bank’s monetary policy decisions. Any improvement in dollar supply could further narrow the gap between the official and parallel markets.
For now, the official market continues to offer greater stability, while the parallel market remains a key source of foreign currency for many Nigerians unable to access dollars through formal banking channels. The coming weeks will be closely watched to see whether the naira can maintain its current stability amid ongoing demand for foreign exchange and broader global economic pressures.
