On Monday, the Nigerian naira opened the week on a sour note in the official foreign exchange market with an opening rate sliding to as low as N1,583 per United States dollar. Central Bank of Nigeria statistics confirmed.
This consequently brought the currency back following yesterday’s previous closing rate of N1,579 per dollar, following apprehension of poor turnaround after its momentary firmness last week at the official window.
Monday’s trades recorded the naira trading at a generally stable N1,578 to a high of N1,583 against the dollar. The daily average exchange rate closed around N1,579.65 against the dollar. These moves follow existing economic tension and the uncertainty of Nigeria’s foreign exchange policy direction.
Naira also traded mixed against other currencies in the official market. It depreciated against the British pound to N2,141.32 per pound from N2,136.75 on Friday. It gained somewhat against the euro from N1,791.95 to N1,796.79 per euro.
The naira, nonetheless, held firm in the black market and even gained modestly. It rose to N1,618 per dollar on Monday, just slightly higher than N1,620 last Friday. That is in line with marginal appreciations in the black market, as the currency gained from N1,627 to a dollar last Monday.
Despite all this profitability for the dollar in the black market, the naira depreciated against other major currencies. The value against the British pound appreciated to N2,160 on Monday from N2,150 last Friday. That rate had come under volatility last week, indicating growing volatility in the forex market.
But yet another fall in foreign reserves in Nigeria is yet another reason for additional pressure. The country’s foreign exchange reserves were about $38.55 billion as of May 23, 2025, down from $38.56 billion just a day earlier. Recent readings undo the earlier pick-up in early May, when reserves rose by $364 million over a fortnight, the largest rise since 2025.
The recently dwindling reserves follow close on the heels of consolidation in regulation in the Bureau De Change business. The Central Bank of Nigeria’s restructuring has been tough, even more so for BDCs through recapitalization and strict regulation. The central bank dramatically hiked the minimum capital requirement in May 2024, which raised Tier 1 BDCs’ minimum capital to N2 billion and Tier 2 operators’ to N500 million. This is part of a coordinated effort to decontaminate the industry and deter foreign exchange speculation and manipulation.
Fewer than five percent of the Bureau de Change operators who signed on comply with the new minimum capital requirement by the June 3, 2025, deadline, Association of Bureau De Change Operators of Nigeria (ABCON) reports. The move sparked panic in the sector after the threat that dozens of the operators would have their licences cancelled should the CBN fail to extend the deadline.
They warn that curtailing monitoring would render short-run retail forex market liquidity volatile and bear consequences for exchange rate dynamics in the parallel and official markets. The CBN’s crackdown on the BDCs is deemed a policy of obtaining a cleaner, stable foreign exchange, but at the cost of inducing short-run shocks.
With June in large print, everyone is now looking for how the central bank will transition to the BDC and whether it will relieve suffering players. With suspicion being the flavour of the day and reserves dipping slightly, policymakers are increasingly being forced to stabilize the naira and calm investors.
