The naira depreciated on Wednesday while the U.S. dollar strengthened against major global currencies as the ongoing Mideast war rattled economies, creating global inflation concerns.
The naira fell to N1,391/$ from N1,383.5/$ recorded on Tuesday, according to data from the Central Bank of Nigeria (CBN).
Ongoing volatility in the foreign exchange market has continued to weigh on the naira, as it traded between N1,376/$ and N1,391.5/$, with a simple average of N1,387.22/$.
The development was after the Naira weakened slightly to N1,383.5/$ on Tuesday, compared to N1,383/$ on Monday, amid sustained pressure over recent months due to a combination of global and domestic factors, including dollar strength, capital flow dynamics, and monetary policy tightening in advanced economies.
NFEM interbank turnover declined to $55.7 million on Wednesday from $83.4 million recorded on Tuesday.
The number of deals executed at the interbank market dropped to 64, down from 88 deals in the previous session.
The data also showed a slight dip in Nigeria’s external reserves, signalling continued pressure on the country’s foreign exchange buffers.
Nigeria’s external reserves declined slightly to $49.57 billion on March 24, 2026, from $49.6 billion recorded on March 23, 2026.
The drop in reserves highlights ongoing pressures on Nigeria’s ability to support the naira in the foreign exchange market.
Globally, the U.S. dollar gained strength on Wednesday, with the dollar index rising by 0.44% to 99.62, as traders assessed inflation trends and geopolitical developments. The euro fell by 0.39% to $1.1562, while the British pound declined by 0.37% to $1.3362.
The rise in the dollar was driven by inflation expectations and risk sentiment, which have continued to influence the naira and other emerging market currencies.
Rising U.S. import prices, which recorded their biggest increase in nearly four years in February, have reinforced expectations of sustained inflation, increasing the likelihood of tighter monetary policy in the United States.
Geopolitical tensions, particularly around Iran, continue to influence global market sentiment and currency movements.
Other global currencies also weakened against the dollar, with the Japanese yen falling to 159.46 per dollar and the Australian dollar declining by 0.63% to $0.6949.
While U.S. President Donald Trump indicated progress in talks, Iranian officials denied direct negotiations, adding to market uncertainty.
Global crude oil prices fell by 1.37% to $103.06 per barrel despite the tensions, while risk sentiment remained mixed across equities and bonds.
Other global currencies also weakened against the dollar, with the Japanese yen falling to 159.46 per dollar and the Australian dollar declining by 0.63% to $0.6949.
Iran said it is reviewing a U.S. proposal to end the ongoing conflict, but has raised concerns over sovereignty issues related to the Strait of Hormuz.