The naira weakened to ₦1,483/$ on Wednesday morning after holding steady in late November, as importers and retailers actively sought dollars to prepare for Christmas and New Year sales.
The currency fell from ₦1,454.38/$ on Tuesday, compared to ₦1,448.43/$ on Monday in the Nigerian Foreign Exchange Market (NFEM), according to Central Bank of Nigeria (CBN) data.
Traders said the market has experienced mild but sustained pressure as businesses front-loaded their foreign exchange needs ahead of the year-end.
The US Federal Reserve’s hawkish stance, coupled with strong retail demand, is also weighing on the naira in the unofficial market, reversing the recent stability.
Retail-level dollar demand, particularly in the parallel market, has been driven by rising international travel bookings and payments for overseas school fees.
A “hawkish” Fed often maintains or signals higher interest rates for longer than expected to combat inflation rather than stimulate growth. This makes the US dollar more attractive to investors, prompting capital outflows from frontier markets like Nigeria.
Despite this, the year-to-date performance shows that, supported by CBN interventions, foreign exchange reforms, and diaspora remittances, the naira has appreciated by about 5.7% against the USD, stabilizing in the ₦1,450–₦1,470/$ range since early December.