By Atoyebi Nike
The Nigerian naira recorded a minor drop against the US dollar on Tuesday, shedding value in both the official and parallel forex markets.
Data from the Central Bank of Nigeria showed that the official exchange rate closed at ₦1,533/$, slightly down from ₦1,531.95/$ on Monday. Meanwhile, traders in the black market saw the naira weaken by ₦5 to ₦1,565/$ from ₦1,560/$ the previous day.
This decline comes despite positive fundamentals pointing to increased investor interest in Nigeria’s economy. On Monday, the naira had made gains, coinciding with a boost in the country’s external reserves, which rose to $39.54 billion on August 1. Analysts attributed this rise to strong foreign portfolio participation in the CBN’s open market operations (OMO), which are offering attractive returns.
The National Bureau of Statistics (NBS) reported that Nigeria attracted $5.64 billion in capital importation in Q1 2025. Portfolio investment dominated the inflow at $5.2 billion, while other investments and foreign direct investment contributed $311.17 million and $126.29 million respectively.
The UK led the sources of capital, contributing $3.68 billion, which accounts for 65.26% of the total inflow, followed by South Africa and Mauritius.
Globally, the dollar index dipped slightly by 0.1% on Wednesday to 98.527, after recent weakness following underwhelming U.S. job data. Market focus is now on President Donald Trump’s expected announcement of a new Federal Reserve Board nominee. Speculation about a rate cut in September continues, with markets pricing in a high chance of policy easing before year-end.
Despite pressures on the naira, analysts remain optimistic due to rising foreign interest and strong portfolio inflows into the Nigerian market.
