CBN Increases Dollar Supply as Naira Gains Across Markets

The Nigerian naira is showing signs of renewed strength, closing June on a high note as the Central Bank of Nigeria (CBN) ramps up its intervention in the foreign exchange (FX) market. 

After months of volatility and pressure, the naira gained ground both in the official and parallel markets, thanks in part to a fresh injection of dollars from the apex bank.

According to data from the Nigerian Foreign Exchange Market (NFEM), the CBN released over $96 million into the FX market last week, a move that played a critical role in stabilizing and strengthening the naira. 

As of Monday, June 30, 2025, the official exchange rate stood at ₦1,529.71 to the dollar, improving from ₦1,539 just days earlier.

This appreciation is not limited to the official window alone. In the parallel market, where dollar rates often reflect street-level demand and supply, the naira also made gains — appreciating by about 1.9% to trade at ₦1,575 per dollar.

What’s driving the naira’s rebound?

Several factors are fueling the naira’s recent performance. One major contributor is the increased confidence of foreign portfolio investors (FPIs), who have shown sustained interest in Nigeria’s fixed income market for the sixth consecutive week. 

Their inflows, along with participation from exporters and non-bank corporates, helped push total FX inflows to $1.03 billion last week, according to Coronation Research.

Breakdown of contributors to FX inflows:

• Foreign Portfolio Investors: 36.98%
  
• Non-bank corporates: 27.56%
  
• Exporters: 22.39%
  
• Others: 13.06%
  

Analysts say the CBN’s consistent dollar supply strategy is restoring investor confidence in the official market, helping to close the gap between official and black-market rates while easing pressure on importers and other dollar-dependent sectors.

Oil Prices and Investor Sentiment

While Nigeria’s oil sector still plays a crucial role in dollar inflows, recent oil price movements have added some uncertainty. 

Brent crude dropped to around $68 per barrel, and West Texas Intermediate (WTI) hovered slightly above $65 a dip from previous weeks. However, Nigeria’s Bonny Light crude remained relatively stable at around $81 per barrel.

Experts warn that while CBN’s FX interventions are essential in the short term, long-term naira stability will also depend on rising foreign reserves and consistent investor appetite for local assets. Nigeria’s foreign reserves saw a modest 0.78% increase, ending the week at $37.37 billion.

What you should know

Under the leadership of Governor Olayemi Cardoso, the CBN seems to be doubling down on its commitment to manage liquidity and defend the naira. 

By improving dollar availability and attracting investor inflows, the apex bank is not only easing market tension but also strengthening Nigeria’s economic outlook.

If this trend continues, supported by stable oil revenues and disciplined monetary policies, the naira may continue to regain lost ground in the coming months. For now, Nigerians can cautiously hope that the tide is finally turning in favour of their local currency.