Nigeria’s FX Market Records 51% Drop in Dollar Transactions as Weekly Turnover Falls to $1.81 Billion

Nigeria's foreign exchange market has seen a notable drop in dollar transactions, as weekly turnover declined by 51.29 per cent to $1.81 billion in the week ended November 6, 2026.
This decrease amounts to roughly $1.90 billion less than the $3.71 billion posted the previous week, underscoring how sharply trading activity has weakened within just seven days.
Based on data from FMDQ, average daily foreign exchange turnover also fell from $742.51 million to $361.67 million, pointing to a considerable drop in transactions between authorised banks and their customers.
The development occurs as attention remains focused on the naira's stability, foreign investment inflows and the availability of dollars for businesses operating in Nigeria.
What Is Causing the Decline?
The steep drop in dollar transactions was mainly driven by reduced activity in Nigeria's spot foreign exchange market.
Spot transactions involve the buying and selling of foreign currencies for immediate or near-immediate delivery. According to the latest FMDQ figures, this segment posted a 50.91 per cent decline, dropping from $3.64 billion to $1.79 billion.
It represented about 98.77 per cent of all reported foreign exchange transactions during the week.
Forward transactions, which let buyers and sellers agree on an exchange rate for a future payment, also recorded a substantial decline. Turnover in this segment dropped by 69.93 per cent, from $73.83 million to $22.20 million.
However, reduced trading activity does not automatically mean Nigeria has run out of dollars. Foreign exchange turnover measures the value of transactions completed within a given period, not the country's total foreign currency reserves.
According to market analysts cited by Nairametrics, several factors could shape the direction of the naira, including foreign exchange reserves, Nigeria's current account surplus, global financial conditions and seasonal demand for dollars.
Cordros Securities expects the naira to stay relatively stable in the near term but cautions that lower domestic investment returns and tighter global financial conditions could weigh on foreign investment inflows.
Cowry Asset Management also lists crude oil prices, seasonal payment obligations and sustained demand for dollars as factors that could constrain further appreciation of the naira.
The Naira Comes Under Pressure Despite Lower Trading
Interestingly, the slowdown in dollar transactions coincided with a slight depreciation of the naira.
According to Nairametrics, the naira weakened by about 0.1 per cent to ₦1,349 per dollar during the reporting week, despite a reported $50 million intervention by the Central Bank of Nigeria.
Forward exchange rates also weakened across various maturity periods, suggesting that market participants still anticipate possible pressure on the naira in the months ahead.
This points to a key distinction: lower dollar trading does not by itself mean a stronger local currency.
The exchange rate also hinges on how many dollars flow into the market, how much businesses and individuals need them, and how confident investors feel about holding assets denominated in naira.
Why Should Ordinary Nigerians Care About This?
Foreign exchange activity is directly tied to the cost of living and to how businesses operate across Nigeria.
Many local manufacturers and importers rely on dollars to buy raw materials, machinery, fuel-related products and finished goods from abroad.
When dollars become costly or hard to obtain, businesses may end up spending more to import these products. Those extra costs can eventually be passed on to consumers in the form of higher prices.
For instance, a Nigerian business importing electronics, pharmaceutical products or manufacturing materials may need more naira to make the same international payment if the exchange rate weakens.
Foreign exchange conditions can therefore shape production costs, business expansion, employment and the prices Nigerians pay for everyday goods.
A more active currency market can also make it simpler for buyers and sellers to complete transactions. Even so, higher trading volumes on their own do not guarantee a stronger naira or cheaper imports.
What Comes Next?
Nigeria's foreign exchange market has seen considerable swings in recent weeks. Nairametrics previously reported that dollar trading nearly doubled to $3.37 billion in the week ended October 9, 2026, after an earlier decline.
The latest drop further underlines how unpredictable trading activity has become.
Looking ahead, investors and businesses will be monitoring foreign exchange inflows, crude oil earnings, foreign investment and dollar demand for signs of improvement.
In the end, lasting stability will hinge on a steady dollar supply, investor confidence and the ability of the foreign exchange market to meet the needs of businesses and other participants.
For ordinary Nigerians, the main concern is still whether improvements in the currency market will eventually lead to more affordable imports and greater price stability.