Naira gains as FX turnover hits $1.5bn in single day, CBN Cardoso credits reforms
By Aboki Forex —
Nigeria's foreign exchange market recorded a massive single-day turnover of $1.5 billion on Tuesday, driving the naira stronger against the dollar in both the official and parallel markets. The surge in trading volume, up 87.63 per cent from $816.79 million the previous day, signals sharply improved liquidity across FX segments.
Naira strengthens on official and parallel markets
Central Bank of Nigeria (CBN) data showed the dollar fell to N1,375.31 at the Nigerian Foreign Exchange Market (NFEM) on Tuesday, a N4.80 improvement from N1,380.11 on Monday. That represents a 0.35 per cent gain for the naira.
In the parallel market, the naira firmed to N1,400 per dollar on Wednesday morning, up N12 from N1,412 traded the prior week. The gap between both rates narrowed to 1.8 per cent, down from 2.54 per cent on Monday, signalling improving alignment between official and street prices.
Deal volumes also rose sharply. The number of transactions executed at the NFEM increased by 16.79 per cent to 313 on Tuesday, July 21, 2026, from 268 the day before. In the interbank segment, turnover climbed 21.19 per cent to $322.66 million, while deals jumped 61.76 per cent to 110 from 68, pointing to broader market participation.
Reserves hit 17-year high, Cardoso speaks on reforms
Underpinning the improved market conditions are Nigeria's external reserves, which reached a 17-year high of $52.02 billion as of July 20, 2026, according to CBN data. That figure is about 36 per cent higher than the same period a year earlier.
CBN Governor Olayemi Cardoso, speaking at the BusinessDay 14th Annual CEO Forum in Lagos during a fireside chat with BusinessDay chief executive Frank Aigbogun, linked the reserve gains to reforms introduced since the current CBN leadership took office.
"When we started, the net reserves figure was in the region of about $3 billion plus. If you remember, that was a figure published at the time by J.P. Morgan, and it created a lot of panic in the system. More recently, our net reserves figure is in the $40 billion. It has been a long and difficult journey, but there has been regime change in the Central Bank of Nigeria, and that regime change is what has brought about these outcomes," Cardoso said.
Cardoso said the bank plans to keep building reserves to maintain adequate buffers against external shocks and to sustain investor confidence. He added that Nigeria's current reserve level provides roughly 10 months of import cover, and that a more transparent FX market has helped lay the groundwork for increased investment and longer-term economic growth.
The shift from a multi-rate exchange system to a more market-driven structure has been central to the CBN's reform agenda, with Tuesday's trading figures offering one of the clearest signs yet of improved liquidity in Nigeria's FX market.
What this means for the naira and Nigerian businesses
The narrowing gap between official and parallel market rates, combined with record FX turnover and rising reserves, suggests that CBN reforms are gaining traction. For Nigerian businesses and consumers, improved FX liquidity could mean more predictable access to dollars and less pressure on the naira in the weeks ahead, though analysts remain cautiously optimistic given global economic pressures.