THE Central Bank of Nigeria (CBN) has given reasons for Nigeria’s naira depreciation, despite its intervention to the tune of $197.71 million to boost liquidity and stability in the country’s foreign exchange (FX) market.
The naira saw its worst decline on Friday, April 4, but the Apex bank said the country’s currency problems are caused by a global macroeconomic shift triggered by Trump tariff tension, which saw the American government impose tariffs on most countries to protect its economy.
The ICIR reports that the weakening of the naira may also be not be unconnected to the recent drop in global oil price which is the main revenue accrual for the Nigerian government.
According to data from the CBN, the official exchange rate crashed to N1,600/$1 at the end of trading on Friday.
It was the worst decline since December 4, 2024, when it closed at N1,608/$1.
On Thursday, April 3, the naira had closed at N1,569/$1; compared to Friday’s closing figure, the naira depreciated by 1.9 per cent.
Amid its weakest level on Friday, the naira also weakened by 3.9 per cent in the first four days of April, after closing March at N1,537/$1.
In a statement on Saturday, April 5, CBN’s Director of the Financial Markets Department, Omolara Duke, the apex bank, said the United States (U.S) tariffs measures have continued to rattle the global markets.
“In line with its commitment to ensuring adequate liquidity and supporting orderly market functioning, the CBN facilitated market activity on Friday, April 4, 2025, with the provision of US$197.71 million through sales to Authorised Dealers,” CBN said.
It noted recent movements in the FX market between April 3 and 4, which reflected broader global macroeconomic shifts currently affecting several emerging market and developing economies.
Nigeria, like most other countries, is currently experiencing economic shock with the tariffs imposed by U.S. President Donald Trump.
The American president had recently imposed a 14 per cent import tariff on products from Nigeria.
This development has affected the value of the naira to the dollar in the last few days, CBN further stated.
These developments were a result of the recent announcement of new import tariffs by the United States government on imports from several economies, which has triggered a period of adjustment across global markets.
“Crude oil prices have also weakened, declining by over 12% to approximately US$65.50 per barrel – presenting new dynamics for oil-exporting countries such as Nigeria,” the apex bank pointed out.
According to the CBN, the injection of FX into the market aligns with the bank’s broader objective of fostering a stable, transparent, and efficient foreign exchange market.
“The CBN continues to monitor global and domestic market conditions and remains confident in the resilience of Nigeria’s foreign exchange framework, which is designed to adjust appropriately to evolving fundamentals.
“All Authorised Dealers are reminded to adhere strictly to the principles outlined in the Nigeria FX Market Code and to uphold the highest standards in their dealings with clients and market counterparties,” it added.