The naira strengthened against the US dollar at the Nigerian Foreign Exchange Market (NFEM) on Friday, closing at N1,337/$.

The latest gain came as foreign exchange turnover in the market dropped sharply by 48.7 per cent week-on-week to $2.71 billion.

Data from the Central Bank of Nigeria (CBN) showed that the naira closed at N1,337/$ on August 28, compared with N1,349.99/$ recorded at the previous trading session on August 24.

This represents a 0.96 per cent appreciation of the naira during the week.

The currency opened the week at N1,349.99/$ on August 24 before strengthening to N1,343/$ on August 26 and N1,336/$ on August 27.

It eventually closed at N1,337/$ on August 28, trading within a range of N1,335/$ and N1,350/$ during the reported sessions.

The foreign exchange market recorded its highest activity on August 26 and 27, with transactions valued at about $913.76 million and $1.06 billion respectively.

Turnover on August 24 stood at $731.18 million, while the market was closed on August 25 because of the public holiday.

In total, FX turnover for the week stood at approximately $2.71 billion, a significant drop from the $5.28 billion recorded between August 17 and 21.

Meanwhile, the naira also gained slightly in the parallel market, where it appreciated to N1,403/$ on Friday from N1,407/$ on Thursday.

The latest strengthening of the naira comes amid an improvement in Nigeria’s external reserves.

Nigeria’s foreign exchange reserves crossed the $53 billion mark during the week, reaching $53.11 billion as of August 24. This is the highest level recorded in more than 17 years.

Higher foreign reserves provide the country with stronger external liquidity and could improve confidence in Nigeria’s ability to meet its foreign exchange obligations.

However, the naira’s recent gains are coming at a time when international oil prices have fallen.

Brent crude futures dropped by 39 cents, or 0.43 per cent, to settle at $89.31 per barrel on Friday, while West Texas Intermediate (WTI) fell by 13 cents, or 0.16 per cent, to $83.40 per barrel.

For the week, Brent crude declined by more than five per cent, while WTI fell by over four per cent.

CBN Governor Olayemi Cardoso has previously dismissed claims that the apex bank is heavily intervening in the foreign exchange market to defend the naira.

According to Cardoso, CBN interventions accounted for only about 1.2 to 1.3 per cent of total FX turnover in 2025.

He attributed improvements in the foreign exchange market to reforms introduced by the CBN, including the FX Code, electronic trading platforms and a revised foreign exchange manual.

The governor has also said that Nigeria has built sufficient economic buffers to manage external shocks and inflationary pressures arising from developments in the global economy.