The naira appreciated against the dollar at the official foreign exchange market on Monday, June 8, breaking a two-day losing streak and signalling renewed strength for the Nigerian currency.
The CBN's data showed the naira firmed to N1,362.84 on Monday from N1,362.21 on Friday. The gain, though modest at 64 kobo per dollar, marked a shift after the currency weakened on Thursday and Friday last week.
On the parallel market, the naira remained flat at N1,395 per dollar, matching Friday's close. The spread between the official and black market rates stayed at around N32, typical for the informal channel.
The appreciation came as Nigeria's foreign reserves climbed to $50.12 billion as of Friday, June 5, according to CBN figures. The rising reserves typically provide support for the naira by boosting the central bank's capacity to intervene in the foreign exchange market and meet legitimate dollar demand.
The recovery in the naira reflects improved dollar inflows into the economy, likely driven by higher crude oil revenues. Nigeria's oil sector remains the dominant source of foreign currency, and prices have remained relatively stable in recent weeks.
Analysts have flagged the importance of sustaining current reserve levels to keep the naira stable and predictable for businesses and investors. The currency's performance this year has been rocky, with sharp moves in both directions creating uncertainty in the economy.
The CBN has maintained its commitment to market-based exchange rate determination while stepping in to prevent excessive volatility. The central bank has also tightened monetary policy to support the naira and control inflation, which has remained elevated.
Traders and businesses will watch closely for data on crude oil prices and global risk appetite this week, as these factors typically drive dollar flows into Nigeria. The CBN is expected to continue its weekly foreign exchange sales at the official window to ensure adequate dollar supply.
