Foreign Capital Boosts Naira by ₦7.10 Amid $21 Billion Inflows
Atume Terfa
The Naira closed the week stronger, gaining ₦7.10 against the dollar on the official foreign exchange market as foreign portfolio investment (FPI) flows surged toward nearly US $21 billion — one of the largest inflow totals Nigeria has seen in years.
At Friday’s close, the dollar was quoted at ₦1,446.74, down from ~₦1,453.84 at the start of the week, a clear sign of renewed investor confidence as the local market responds to increasing foreign capital and improving macroeconomic signals.
Data from the Central Bank of Nigeria (CBN) reveals that between January and October 2025, foreign capital inflows reached US$20.98 billion — a 70 per cent jump compared to total inflows in 2024 and a dramatic 428 per cent increase from the inflows recorded in 2023.
Coupled with broader reforms, the inflows have helped tighten the gap between official and parallel market rates and reinforced market liquidity.
On the parallel market, however, the naira saw a modest decline, closing at ₦1,465 to the dollar — a slip traders attributed to demand pressure in the informal trading segment.
Industry analysts say the rebound reflects growing trust in Nigeria’s new foreign exchange framework, rising foreign reserves, and stronger currency supply. The recent inflows, coupled with improvements in external reserves — now running at their highest in several years — are viewed as signals that the naira could be entering a more stable period.
Still, experts caution that sustaining the momentum will depend on continued policy consistency, improved structural conditions, and stable inflows across sectors. For now, the naira is not just holding steady — it is pushing back.
