The Nigerian Naira began the second trading session of March on a softer note against the US dollar, as the foreign exchange market adjusted after a week of steady gains.
Data from the Nigerian Foreign Exchange Market showed that the Naira opened at 1,368.28 per dollar on Tuesday, March 3, 2026. During mid-morning trading, the rate fluctuated slightly, touching a high of 1,370.59 before settling around 1,370.30 by midday. This reflects a marginal depreciation compared to the February 27 closing rate of 1,368.50.
The recent movement follows a month in which the official average rate stood at 1,364.74. Market participants say the slight weakening is linked to increased corporate demand for foreign exchange, particularly from manufacturers restocking for the second quarter. While the Central Bank of Nigeria continues to provide liquidity support, seasonal demand pressures are beginning to show.
Parallel Market Remains Stable
In the parallel market, the dollar is trading between 1,375 and 1,382 per dollar, maintaining a narrow gap with the official rate. Traders in Lagos and Abuja report that the informal market has remained relatively calm, without the sharp speculative swings seen in previous years.
The steady supply of foreign exchange to Bureau De Change operators is believed to have helped stabilise retail demand for travel and small-scale business transactions, contributing to the convergence between official and parallel market rates.
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Key Drivers in Focus
Several macroeconomic factors are shaping the Naira’s outlook:
Foreign Reserves: Nigeria’s external reserves remain strong, recently reaching a multi-year high. This gives the apex bank room to manage short-term volatility.
Interest Rate Policy: The recent 50-basis-point cut in the Monetary Policy Rate to 26.50 per cent signals a gradual shift toward supporting economic growth. However, such adjustments can sometimes place mild pressure on the currency in the short term.
Trade Balance: Stable oil production, averaging about 1.46 million barrels per day, continues to support foreign exchange inflows, helping to offset demand from the manufacturing and services sectors.
Analysts expect the Naira to trade within the 1,365 to 1,375 range for the rest of the week, as the market absorbs recent liquidity injections and balances demand pressures.
