The naira remained relatively stable against the euro last week, with the Central Bank of Nigeria (CBN) reference rate showing the currency trading at N1,576 per euro, compared with N1,573 in the previous week.
The latest movement keeps the euro below the N1,580 threshold despite continued pressure in the global currency market.
The naira has strengthened significantly against the euro since the beginning of the year. The euro was trading around N1,774 in January before falling to a multi-month low of N1,555.
Since early July, the EUR/NGN exchange rate has remained within a narrow band of about N1,561 to N1,576.7, reflecting reduced volatility in the official foreign exchange market.
Analysts attribute the relative stability partly to increased CBN intervention and liquidity injections into the forex market, alongside recent structural and regulatory measures aimed at improving market efficiency.
Among the measures introduced by the apex bank is an increase in the upfront payment requirement for imports of physical goods from 15 per cent to 30 per cent of the free-on-board (FOB) value. The adjustment is expected to simplify import procedures while easing working-capital pressures for businesses.
The CBN also removed the requirement for self-funded domiciliary account holders to complete Form A, allowing eligible funds to be transferred directly to their intended destination.
In addition, the apex bank increased personal and educational allowances to $25,000 per semester for international school fees. Under the revised rules, 25 per cent of Personal Travel Allowance and Business Travel Allowance can be paid in physical foreign currency, while the remaining 75 per cent is settled electronically.
The combination of tighter monetary conditions, improved forex liquidity and regulatory adjustments has helped limit sharp movements in the official exchange rate, even as Nigeria continues to contend with elevated inflation.
Meanwhile, developments in the global currency market could influence the naira’s performance against the euro in the coming days.
The euro remained below $1.16 against the US dollar at the start of the week, while weaker-than-expected US employment data raised expectations of a less hawkish stance by the US Federal Reserve.
However, geopolitical tensions and uncertainty around shipping through the Strait of Hormuz continue to support demand for the US dollar as a safe-haven asset, creating mixed signals for the euro.
Investors are also awaiting US inflation data for further clues about the Federal Reserve’s monetary policy direction.
For Nigeria, sustained forex liquidity and the CBN’s ongoing reforms remain critical to maintaining the relative stability seen in the official market.
