The naira appreciated against the dollar on Tuesday, extending its positive momentum from the beginning of the week. At the Nigerian Autonomous Foreign Exchange Market (NAFEM), the official rate closed at N1,579.28 per dollar, slightly stronger than the N1,581.58 recorded on Monday. On Monday, the currency had already gained N4.57 from Friday’s N1,586.15, signaling a solid start to the week.
In the parallel market, the naira also firmed up. It closed at N1,595 per dollar on Tuesday, improving from N1,615 on Monday. This followed a notable gain on Monday, when the currency strengthened by N13 from Friday’s N1,628 per dollar.
Analysts attributed the sustained appreciation to increased foreign portfolio inflows and anticipation of the upcoming Eid el-Kabir holidays scheduled for June 6 and 9, 2025. The holiday-driven demand for naira may be pushing the dollar supply higher across different channels.
A report from Coronation Merchant Bank’s research team noted a drop in total foreign exchange inflows at NAFEM, falling to $1.04 billion last week from $4.42 billion the previous week. Despite the decline, foreign portfolio investors (FPIs) and non-bank corporates were the major contributors. FPIs accounted for 32.02 percent of the total inflows, followed by non-bank corporates at 29.49 percent. The Central Bank of Nigeria (CBN) contributed 19.71 percent, exporters 18.33 percent, while other sources made up the remaining 0.45 percent.
The naira’s recent gains indicate increased investor confidence and a relatively improved FX supply environment, although sustainability will depend on consistent inflows and monetary policy support.
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