Recent gains in the naira were reversed as foreign investors and debt service obligations spurred demand for the US dollar. The exchange rate came under pressure on Tuesday due to heightened demand amidst constrained supply.
The US dollar-naira pair fluctuated between ₦1,520 and ₦1,540 in the official markets before settling at ₦1,536.15, AIICO Capital Limited reported. Data from FMDQ indicated that total inflows into the foreign exchange market declined by 12.9% to $4.12 billion in February, compared to $4.74 billion in January.
This decline was broad-based across both foreign and local inflows, with the Central Bank of Nigeria's contribution falling by 36.3%. Analysts anticipate that the Central Bank will continue supporting the naira to stabilize the currency despite successive declines in external reserves.
Nigeria’s foreign reserves fell to $38.35 billion amid uncertainties in global commodities markets, straining oil export receipts. Oil prices edged higher on Tuesday, buoyed by a weaker dollar, though concerns over a potential U.S. economic slowdown and global trade tariffs tempered gains.
Brent crude futures rose 36 cents, or 0.5%, to $69.64 a barrel after hitting a session low of $68.63. U.S. West Texas Intermediate crude climbed 28 cents, or 0.4%, to $66.31 following earlier declines.
Meanwhile, gold prices gained 1% as a weaker dollar and economic uncertainty fueled safe-haven demand. Investors awaited inflation data for clues on the interest rate outlook. Spot gold rose 1% to $2,919.29 an ounce, while U.S.
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