The naira depreciated slightly against the dollar in the official foreign exchange (FX) market in May 2026 as trading activity and liquidity slowed across the market. This trend highlighted softer dollar flows despite a rebound in Nigeria’s external reserves.
Data published by the Central Bank of Nigeria (CBN) showed that the naira weakened by N8.00 month-on-month. The dollar was quoted at N1,373.25 at the close of trading on Friday, representing a loss of 0.58 percent compared with the opening rate of N1,365.25 at the Nigerian Foreign Exchange Market (NFEM) window at the beginning of May.
The currency’s decline came even as Nigeria’s external reserves rose sharply during the month, suggesting that stronger reserve buffers were yet to translate into improved market liquidity. Activity across both the interbank and official FX windows slowed, with declines recorded in transaction volumes, turnover, and deal counts.
Weekly fluctuations and volume declines
On a weekly basis, however, the naira strengthened marginally by N2.21 or 0.16 percent from N1,375.46 quoted the previous week. Over the three trading days this week, the local currency also gained N1.67 from N1,374.92 quoted on Monday.
