The Nigerian naira weakened to ₦1,541.36/$ on the first trading day of 2025, reflecting a 0.36% depreciation compared to its closing rate of ₦1,535.82/$ at the end of 2024.
According to data from the Central Bank of Nigeria’s Nigerian Foreign Exchange Market (NFEM), some authorised dealers quoted the dollar at ₦1,545/$ on Thursday, a slight improvement from ₦1,550/$ earlier in the week. Others quoted rates as low as ₦1,520/$. In the parallel market, the naira closed trading at ₦1,655/$, strengthening marginally from ₦1,670/$ on Tuesday.
The naira experienced a significant depreciation of 40.9% throughout 2024, dropping from an official rate of ₦907.11/$ at the close of 2023.
The depreciation comes amid several foreign exchange reforms introduced by the Central Bank of Nigeria (CBN) aimed at improving market transparency and attracting foreign investment. One of the key reforms, the Electronic Foreign Exchange Matching System launched in December, set new guidelines for authorised dealers, providing some stability to the naira.
In the money market, the Nigerian Interbank Offered Rate (NIBOR) recorded declines across all maturities, indicating ample liquidity in the banking system. Additionally, the Open Repo Rate fell by 0.61% to 26.69%, while the Overnight Lending Rate dropped by 0.55% to 27.25%.
The naira’s performance and associated market indicators underscore ongoing challenges in Nigeria’s foreign exchange system. Analysts suggest that sustained reforms and increased investor confidence will be essential to stabilise the currency in 2025.
