The naira depreciated marginally against the US dollar at the official foreign exchange market, closing at ₦1,334.99 per dollar on Tuesday, October 20, despite a decline in the greenback’s value in international markets.
Data from the Central Bank of Nigeria showed that the closing rate represented a 0.11 per cent depreciation from ₦1,333.50 recorded in the previous trading session.
The naira traded between ₦1,331.80 and ₦1,335 per dollar during the session, while its weighted average exchange rate stood at ₦1,333.65.
The CBN had yet to release the Nigerian Foreign Exchange Market’s complete deal and turnover figures for Tuesday at the time of reporting.
Interbank transactions rise
Interbank foreign exchange transactions recorded 70 deals on Tuesday, with turnover of approximately $60.72 million, according to the report.
The simple average exchange rate stood at ₦1,333.59 per dollar.
On Monday, the Nigerian Foreign Exchange Market recorded 230 deals, while reported interbank turnover stood at approximately $40.60 million, compared with Tuesday’s $60.72 million.
The figures indicate an increase in interbank turnover, although the absence of complete Tuesday market data limits a comprehensive comparison of overall foreign exchange activity between the two sessions.
Reserves and foreign investment
Nigeria’s external position has received support from increased portfolio investment and foreign exchange reserves.
Portfolio investment rose by 45 per cent to $6.51 billion in the second quarter of 2026, according to previously reported data.
The country’s foreign reserves also increased by $12.76 billion year-on-year to $54.61 billion as of September 14, 2026.
The reserve figure exceeded the CBN’s previously reported year-end projection of approximately $51.04 billion for 2026.
However, rising reserves and portfolio inflows do not automatically translate into daily naira appreciation, as exchange rates also depend on foreign exchange demand, market liquidity and other economic factors.
Dollar retreats internationally
The US dollar weakened in global markets on Tuesday as lower US Treasury yields and declining crude oil prices reduced its appeal to investors.
According to Reuters data cited in the report, the dollar index fell by 0.25 per cent to 101.71, its lowest level in three weeks, before stabilising at 101.78 on Wednesday.
The Australian dollar gained 0.1 per cent to $0.7013, approaching a three-week high, while the New Zealand dollar declined 0.1 per cent to $0.5677. The Canadian dollar traded largely unchanged at 1.4064 Canadian dollars per US dollar.
Investors were also monitoring upcoming monetary policy decisions by major central banks. Markets largely expected the US Federal Reserve, European Central Bank and Bank of Japan to leave interest rates unchanged at their forthcoming meetings.
Meanwhile, global crude oil prices retreated from a five-month high as renewed diplomatic engagements between Iran and Pakistan raised hopes of easing tensions in the Middle East.
Despite the dollar’s international weakness, the naira’s depreciation highlights that movements in global currency markets do not necessarily produce an immediate or corresponding change in Nigeria’s exchange rate.
