Nigeria’s Interbank FX Market Reawakens As Turnover Climbs 70%

By Kingsley Ani 

Activity in Nigeria’s interbank foreign exchange (FX) market accelerated sharply on Wednesday, with turnover rising almost 70 percent in a single session, signalling stronger participation in formal dollar trading.

DEVELOPMENT: Central Bank of Nigeria (CBN) data showed interbank FX turnover increased to $94.43 million from $55.60 million on Tuesday. The increase came alongside a significant rise in the number of transactions, suggesting broader market activity rather than a turnover jump driven solely by a few large trades.

The dollar traded between N1,321.50 and N1,334, while the weighted average rate stood at N1,329.21/$ before the market closed at N1,328/$.

DATA: Interbank turnover increased by $38.82 million, representing a 69.82 percent jump. Deal count rose from 58 to 86, up 48.28 percent.

The increase remains modest relative to total activity across the Nigerian Foreign Exchange Market (NFEM). Tuesday’s total NFEM turnover was $933.78 million, with the interbank component accounting for only a fraction of that volume.

SIGNIFICANCE: The sharper interbank participation matters because deeper formal-market activity can improve price discovery and liquidity, while providing a clearer signal of underlying demand and supply conditions.

However, the large day-to-day swings in turnover also underline the continuing variability of liquidity in Nigeria’s FX market. The distinction between interbank turnover and aggregate NFEM activity remains important when assessing market depth.

NEXT MOVE: Investors and corporate treasurers should watch whether the higher interbank volume is sustained over subsequent sessions and whether increased participation translates into tighter spreads, greater liquidity and more stable exchange-rate formation.

OUR LENS: The key signal is not simply the 70 percent increase in turnover, but the accompanying 48 percent rise in deal count. That combination suggests a broader reopening of activity within the interbank segment. The test now is whether Wednesday represents a temporary spike or the beginning of a more consistently liquid formal FX market.

Kingsley Ani is a journalist who has over the years been covering capital, markets, corporate results, economic and public-interest developments with a focus on clear, factual reporting.