Naira Strengthens Amid CBN Intervention and Rising FPI Inflows

The naira gained ground at the official foreign exchange market last week, appreciating slightly from ₦1,549/$ to ₦1,547/$, buoyed by dollar interventions from the Central Bank of Nigeria (CBN) aimed at easing corporate demand pressures. The modest 0.13% week-on-week rise extended the currency’s upward trend seen since the beginning of June.

Analysts at Cordros Capital attributed the naira’s resilience to sustained foreign exchange inflows, particularly from foreign portfolio investors (FPIs), who are increasingly participating in the CBN’s Open Market Operation (OMO) auctions. In its latest OMO auction, the apex bank offered ₦600 billion across 155-day and 204-day tenors. Demand far outstripped supply, with total subscriptions hitting ₦1.14 trillion and final allotments reaching ₦1.07 trillion. The stop rates cleared at 24.20% and 24.59%, respectively — signaling high investor interest and confidence.

Despite this uptick at the Nigerian Foreign Exchange Market (NFEM), the naira dipped slightly in the parallel market, closing at ₦1,585/$ — a reminder of ongoing pressures outside official windows.

Looking ahead, analysts at Cowry Asset Management project relative naira stability, citing continued CBN support and growing foreign exchange inflows amid ongoing economic reforms. Cordros Capital echoed the sentiment, but cautioned that global headwinds — especially Middle East tensions driving up oil prices — could inject volatility into the market. While rising oil prices are a potential boon for Nigeria’s crude-dependent economy, they may also complicate the external environment.

Interestingly, this brief period of naira strength came alongside a drop in the country’s foreign reserves, which declined to $37.71 billion by Thursday, according to CBN data.

Meanwhile, as inflation slightly eased to 22.97% in May, Finance Minister Wale Edun visited CBN Governor Olayemi Cardoso in a bid to reinforce coordination between fiscal and monetary authorities. According to the Ministry of Finance, both parties emphasized the need to sustain the positive momentum, stabilize prices, and boost private sector-led growth through joint policy alignment.

“This meeting underscores the Ministry’s commitment to collaborative economic management, signalling a renewed focus on driving sustainable growth and development in Nigeria,” the statement concluded.