The Nigerian foreign exchange market recorded improved stability in April 2026, with the naira appreciating by 1.42 percent against the US dollar. The local currency gained N19.67 to close at an average spot rate of N1,361.51 per dollar, compared to N1,381.18 per dollar recorded in March 2026. This development coincided with the Central Bank of Nigeria's aggressive liquidity management through open market operations, issuing a total of N9.71 trillion in OMO bills during the month.
OMO Bill Issuance Surges
The OMO bill sales represented a 27.37 percent increase, or N2.09 trillion, compared to the N7.62 trillion issued in March 2026. This underscores the apex bank's sustained efforts to mop up excess liquidity from the financial system and support foreign exchange market stability amid lingering inflationary and currency pressures. The surge in OMO issuance reflects the CBN's commitment to maintaining tight liquidity conditions to contain inflation and stabilize the forex market.
Exchange Rate Volatility Eases
The latest market report also showed that exchange rate volatility eased significantly during the month. The naira traded within a relatively narrow band of N1,341.01 to N1,389 per dollar in April, compared with a wider range of N1,345.00 to N1,425 per dollar recorded in March. Analysts said the tighter trading range reflects improving confidence among investors and reduced speculative attacks on the local currency.
Analyst Perspectives
Analysts at Cordros Capital noted that elevated OMO rates have continued to attract portfolio inflows into fixed-income instruments, thereby improving dollar liquidity in the economy. Cowry Asset Management stated that the combination of aggressive liquidity sterilization and improved transparency in the FX market contributed significantly to the moderation in exchange rate volatility. According to them, the narrowing gap in exchange rate movements indicates that policy measures introduced by the monetary authority are gradually restoring confidence among foreign investors and local market participants.
For Comercio Partners analysts, the improved stability of the naira reflected easing panic demand in the FX market as liquidity conditions improved. However, they warned that sustaining the current momentum would depend heavily on the country's ability to generate stronger and more consistent foreign exchange inflows from oil exports, diaspora remittances, and foreign direct investments.
