The Naira continues its turbulent ride in the foreign exchange market as the official rate closed at ₦1,474.78 per $1 on Friday, January 31, 2025, after opening at ₦1,521.94 per $1 the previous day. Despite the Central Bank of Nigeria’s (CBN) efforts to unify the forex market, the parallel market tells a different story, with the Dollar trading as high as ₦1,620 per $1.
The CBN had announced a shift to a unified exchange rate system, scrapping segmentation and allowing all forex transactions to take place within the Investors & Exporters (I&E) window. Under this model, the Naira’s value is now largely determined by market forces, removing previous trading restrictions. However, liquidity constraints and speculative pressures continue to widen the gap between the official and black-market rates.
This move signals a more flexible approach to exchange rate management, but the realities of Nigeria’s forex supply-demand imbalance persist. Until foreign inflows significantly improve, the Naira remains under pressure, leaving businesses and individuals grappling with rising costs.