NFEM Turnover Falls to $185m as Foreign Exchange Market Activity Thins

By Benson Daniel

Turnover on Nigeria’s Foreign Exchange Market fell sharply to $185 million on August 11, 2026, marking the lowest level recorded in 11 weeks as trading activity in the official foreign exchange market weakened.

Data from the Central Bank of Nigeria showed that daily turnover dropped to about $184.99 million from $646.51 million recorded the previous trading day. The decline represents a contraction of roughly $461.5 million, highlighting a significant reduction in market activity.

The latest figure is the lowest since May 25, when turnover stood at $175.34 million. The decline also came despite a weaker naira, which closed at N1,365 per dollar on Tuesday compared with N1,361.50 on Monday.

Trading activity was also reflected in the number of deals executed during the session. The total number of transactions fell to 186 from 348 a day earlier, while interbank transactions declined substantially from 182 to 47.

The naira traded within a relatively narrow range of N1,361 to N1,365.50 per dollar during the session, with the weighted average exchange rate settling at N1,364.8992 per dollar.

The sharp fall in turnover indicates that participants were less active in the official market, following significantly higher levels recorded earlier in the month. NFEM turnover had reached about $1.25 billion on August 7 before declining to $878.55 million on August 6 and $460.14 million on August 5.

Market activity can be influenced by several factors, including the availability of foreign exchange, demand from importers and businesses, foreign portfolio investment flows, export proceeds and broader investor sentiment.

For businesses that rely heavily on imported raw materials, machinery and other inputs, reduced liquidity in the official market could make access to foreign exchange more challenging if the trend persists.

Manufacturers, airlines and other businesses with significant dollar obligations require predictable access to foreign currency to settle international payments and maintain their operations. A less active market can therefore increase uncertainty around foreign exchange transactions.

The development also comes at a time when the CBN continues to pursue reforms aimed at improving the functioning of Nigeria’s foreign exchange market and strengthening confidence in the naira.

The International Monetary Fund has noted that reforms in Nigeria’s foreign exchange market have helped improve liquidity and turnover, while greater exchange rate predictability has contributed to improved financial conditions.

However, the latest decline in daily turnover shows that market activity can remain uneven, with substantial variations from one trading session to another.

The reduced turnover does not necessarily mean that foreign exchange demand has disappeared. Rather, it may reflect changes in the timing of transactions, available dollar supply and the behaviour of market participants.

Sustained improvement in foreign exchange liquidity remains important for Nigeria’s economic outlook. Greater market depth can help businesses plan more effectively, reduce uncertainty and support international trade and investment.

The CBN will therefore continue to face the challenge of maintaining sufficient liquidity while ensuring that foreign exchange market operations remain transparent and responsive to genuine demand.

The coming trading sessions will provide further indications of whether the sharp reduction in NFEM turnover is temporary or represents a more sustained moderation in activity.