Nigeria's naira slipped marginally on Monday as foreign exchange liquidity contracted sharply. The Central Bank reported a 55.23 percent drop in available FX supply.
Official market data showed the naira weakening by N2.66 against the dollar. Trading closed at N1,373.70 per dollar, down from N1,371.04 the previous Friday.
That represents a 0.19 percent depreciation at the Nigerian Foreign Exchange Market window. The movement was relatively modest by recent standards.
Market activity took a significant hit on Monday. Turnover plummeted by $281.24 million to $227.98 million, compared with $509.22 million on May 14.
Deal volume contracted as well. The NFEM window saw just 213 transactions, down 26.29 percent from 289 deals recorded the previous session.
Interbank trading painted a different picture. Activity picked up considerably, with deal count jumping to 92 from 58 — a 58.62 percent increase.
Turnover in that segment also improved markedly. The interbank market posted $76.29 million, up 57.33 percent from $48.49 million Friday.
Black market conditions showed a slight uptick for the naira. The parallel rate strengthened by N5 to N1,390 per dollar from N1,395 the previous week.
The gap between official and informal rates narrowed considerably. Spread between both markets tightened to N17 from N24, signaling greater convergence.
Nigeria's external reserves continued climbing during the period. CBN data confirmed reserves rose by $260 million, or 0.54 percent, to $48.57 billion as of May 15.
Prior week-end figures stood at $48.32 billion. The steady accumulation provides ammunition for supporting the local currency.
A fresh report from the Financial Markets Dealers Association revealed something notable about 2025 FX patterns. Invisible transactions — chiefly financial services — surged past merchandise import demand.
Industrial imports claimed $8.43 billion of total FX utilization last year. That remained the largest goods-related sector.
Yet invisible-linked spending hit $27.27 billion. Financial services drove much of this acceleration, outpacing all merchandise flows combined.
FMDA attributed industrial sector growth to domestic production expansion. Factories imported more machinery and intermediate inputs for manufacturing and infrastructure work.
Financial services demand reflected deeper cross-border transactions. Participants increasingly accessed the formal FX market, analysts noted.
Oil sector FX requirements also jumped last year. Higher refinery operations and expanded energy activities pushed demand upward.
In their analysis, FMDA observers highlighted an important shift. "Nigeria's FX demand structure is becoming increasingly diversified," they said.
Invisible transactions now exert greater influence on liquidity. Traditional merchandise imports no longer dominate currency supply pressures.
