Naira Slides 19 Kobo to N1,533.74 per Dollar in Official Market

When Central Bank of Nigeria posted its Friday update, the Naira had slipped another 19 kobo, closing at N1,533.74 to the USD. The move matters because everyday Nigerians feel the pinch at shops, schools and hospitals – any extra cost on imported goods reverberates through households. The data, released on the bank’s official website, captured the end‑of‑day rate for Nigeria on 4 October 2025, a Friday that saw the official market edging lower while the parallel market stayed stubbornly higher.

Weekly Exchange Rate Overview

Looking back at the week, the official market painted a picture of modest volatility. Monday opened at N1,534.20, a slight gain that gave traders a false sense of stability. By Tuesday the rate nudged to N1,533.18, then rose to N1,534.52 on Wednesday – a bounce that felt almost random. Thursday’s figure of N1,533.55 set the stage for Friday’s 19‑kobo dip. In raw terms, the official market logged a net appreciation of N9.5 for the week, but that modest gain was dwarfed by the parallel market’s loss of N8, where the naira fell to N1,538 per dollar.

Why the Naira Is Fluctuating

The underlying engine is Nigeria’s oil‑centric economy. Crude exports still generate the lion’s share of foreign‑exchange inflows, so any dip in global oil prices or a slowdown in production immediately tightens the dollar supply. Add to that a persistent demand for foreign currency – from importers buying raw materials to families paying school fees abroad – and you have a classic supply‑and‑demand squeeze.

Compounding the problem is the legacy of the dual‑exchange system, a policy that kept an official rate separate from the market‑driven one. Bola Ahmed Tinubu’s administration announced in early 2025 that it would phase out that system, hoping to unify the rates. The intention was to bring more transparency, but the dollar shortage in the official channel forced many businesses into the parallel market, preserving the premium.

Official vs. Parallel Market Dynamics

The parallel market, often called the “black market,” traded at N1,538 on Friday, a hair above Thursday’s N1,535. That premium – N32 over the Nigerian Foreign Exchange Market (NFEM) rate of N1,503.5 – didn’t budge despite the official market’s slide. The unchanged spread signals that traders still view the official channel as scarce, nudging them to seek dollars elsewhere.

• Official market close (Fri): N1,533.74/USD
• Parallel market close (Fri): N1,538/USD
• NFEM rate (Fri): N1,503.5/USD
• Weekly official market gain: +N9.5
• Weekly parallel market loss: –N8

The split has real‑world consequences. A manufacturer needing imported machinery will quote prices in dollars; if the firm can only source dollars on the parallel market, its cost base rises, and the price hike is passed on to consumers.

Policy Moves and Their Impact

Since the decision to float the naira in July 2025, the currency has been subject to market forces rather than a fixed peg. The float was meant to allow the exchange rate to find its equilibrium, but it also opened the door to sharper swings. Analysts say the 19‑kobo dip on Friday is a textbook reaction to a combination of lower oil revenue forecasts and lingering dollar scarcity.

Critics argue that the Central Bank’s occasional interventions – such as selling dollars from its reserves – are too little, too late. The bank’s balance sheet shows a dip in foreign‑exchange reserves, which erodes confidence that the authority can smooth out sharp moves. Meanwhile, the government’s push to attract more foreign direct investment has yet to translate into a noticeable inflow of hard currency.

Looking Ahead: What to Expect

Forecasts for the next quarter hinge on three variables: oil price trajectories, the pace of economic diversification, and the effectiveness of monetary policy. If Brent crude holds above $80 a barrel, the naira might find a modest floor around N1,520. However, a slide below $70 could push the official rate past the N1,550 mark, widening the parallel premium further.

Economists also watch the Central Bank’s upcoming repo‑rate meeting. A higher rate could make holding dollars more attractive for local investors, tightening supply in the official market and possibly nudging the naira up. On the flip side, a rate cut could fuel inflation and weaken the currency further.

Key Takeaways

1. The official Naira fell 19 kobo to N1,533.74 per dollar on 4 Oct 2025.
2. Parallel market remained at N1,538 per dollar, keeping a N32 premium.
3. Weekly performance shows an official gain of N9.5 but a parallel loss of N8.
4. Oil‑price volatility and dollar scarcity drive the swings.
5. Government’s float and the phasing out of dual rates keep the market in flux.