Naira Sinks to New Lows Against the Dollar
There’s no sugarcoating it—the Nigerian naira depreciation has entered another rough patch. On June 4, 2025, the Central Bank of Nigeria (CBN) set the official exchange rate at ₦1,581.58 for $1. Just a few months back, people were already raising eyebrows at the ₦1,533 rate, but things have only gotten tougher. It’s a clear sign that serious pressure sits heavy on the currency. What’s got businesses and travelers even more jittery is the rapidly widening gap with the parallel or black market. Over there, Bureau De Change (BDC) operators are now buying dollars at ₦1,605 and selling at ₦1,615. That’s not just a trivial spread—it’s a glaring signal that official channels are struggling to meet demand.
For folks dealing with foreign trade, tuition, or international payments, the day-to-day hustle is real. The average exchange rate for 2025 so far sits at ₦1,551.34, topped by a sharp peak of ₦1,607.05 in early May. Back in February, the rate sank as low as ₦1,491.37. Meanwhile, the dollar has managed a tidy 2.93% gain against the naira this year. At the same time, if you’re having to get your hands on British pounds or euros, it’s just more of the same pain. On the black market, pounds are trading between ₦2,090 and ₦2,110, while euros go for ₦1,780 to ₦1,800. Official rates? Quite a bit lower—pounds at just over ₦2,129 and euros a little under ₦1,819.
Why Is This Happening? Looking Beyond the Numbers
The big question is, what’s keeping the naira under the heat lamp? For one, foreign exchange liquidity is thin. Nigeria hasn’t had as much dollar supply coming in—less from oil exports, and even less from foreign investors who have gotten jittery about market risks. With fewer dollars available through the official market, businesses and individuals who need foreign currency end up turning to the black market, driving up those already steep rates.
Then you have the role of speculative trading. Some people, worried the naira will drop even further, buy up dollars as a safe bet, making the shortage even worse. It’s a tough cycle: the less people trust in a stable naira, the more they rush into other currencies, putting even more squeeze on the naira’s value.
The policy environment hasn’t exactly calmed nerves either. The CBN has tried to close the gap between the official and parallel rates, and pushed hard to stabilize the naira. But with the country facing debt repayments and inflation concerns, the levers available to policymakers feel limited. On top of all that, global market swings add their own flavor—rising US interest rates mean more competition for the dollar, and geopolitical uncertainties keep foreign investors wary.
What's most striking here is that this isn’t just about numbers on a board—it’s the real-life consequences for everything from imported fuel prices to the cost of rice and school fees. Until liquidity improves or trust returns, it looks like the naira will keep facing an uphill battle against the greenback and other currencies. For now, everyone from importers to families planning holidays abroad have no choice but to watch the exchange rates—and hold their breath for the next move.