Over the past week, the Nigerian naira saw a decline against the U.S. dollar in both the official and parallel markets, reversing some of the gains it had recently recorded.
By the end of the trading week, the naira had depreciated by 1.66% week-on-week, closing at ₦1,517.24/$ compared to ₦1,492.49/$ the previous week.
A similar trend was observed in the parallel market, where the naira weakened to an average of ₦1,520/$, reflecting a steady increase in demand for the dollar.
Bureau De Change operators reported that the naira lost as much as ₦70, closing at ₦1,570/$ by the end of the week.
In February 2025, the naira had posted an 8.5% month-on-month gain in the parallel market, closing at ₦1,490/$, while in the official market, it ended the month at ₦1,500/$, marking a 1.7% month-on-month decline.
Analysts initially maintained an optimistic outlook for the currency in March, barring any unexpected shocks.
However, a market analysis by AIICO Capital Limited suggested that the recent depreciation was driven by a surge in dollar demand from foreign portfolio investors and local businesses.
“The naira depreciated this week due to tight dollar liquidity and increased demand from foreign portfolio investors and local corporates,” AIICO Capital Limited said, adding that offshore demand remained strong, pushing rates higher despite interventions from the Central Bank of Nigeria.
