Throughout the week, the naira continued to rise in all areas of the foreign currency market.

As rates dropped, dollar holders kept liquidating their holdings, which caused losses for many who had previously amassed dollars.

A street vendor told BusinessDay that as the dollar declines in both legal and unofficial markets, a number of operators who had hoarded dollars at higher prices are now selling at a loss. "A few of us made purchases when the rate was quite high. He stated, "We are losing money now that it is dropping," indicating the mounting strain on speculative dollar demand.

At N1,340 per dollar at the end of the week, the naira was stronger in the black market, commonly known as the parallel market. At the official window, this was N1,346.32 per dollar.

According to data from the Central Bank of Nigeria, the value of the naira increased by N9.10 per week on the Nigerian Foreign Exchange Market. From N1,355.42 quoted the previous Friday to N1,346.32 at the end of Friday's trade, this indicated a rise of 0.7 percent.

The local currency stayed mostly unchanged at the NFEM over a five-day trading period. It increased by 0.1%, or N1.46, from Monday's stated price of N1,347.78. However, the value of the naira declined by N4.97, or 0.4 percent, on a daily basis, falling from N1,341.35 on Thursday to N1,346.32 on Friday.

In the parallel market, gains were more pronounced. The naira appreciated by N80 to close at N1,340 on Friday, marking a 5.97 percent gain from N1,420 quoted the previous Friday. On a daily basis, it gained N5 from N1,345 on Thursday. Over the five-day trading period, it strengthened by N40 or 2.98 percent from N1,380 quoted on Monday.

The gap between the official and parallel market rates widened slightly to N6, representing 0.29 percent. This compared with N4 or 0.29 percent recorded on Thursday.

The naira had recorded its strongest convergence level in two years on Thursday. On that day, the spread between the official and parallel markets narrowed to 0.29 percent. This came after a rally that pushed the local currency to a three-year high of N1,345 per dollar in the black market.

Nigeria’s external reserves supported the positive sentiment around the currency. Reserves rose to 48.50 billion dollars as of February 17, 2026, according to Central Bank data. The increase is viewed as bolstering the apex bank’s ability to intervene in the market when required.

Taiwo Ebenezer, South-West chairman of the Association of Bureaux De Change Operators of Nigeria, said the recent appreciation followed the announcement that bureaux de change would resume participation in the NFEM window as directed by the Central Bank.

Despite the optimism, BDC operators have not yet started purchasing dollars from commercial banks. This comes one week after the official reopening of the window to them.

“We are hopeful that trading will commence next week. The modalities are being finalised,” a BDC operator said, adding that improved access to official supply could help the naira appreciate further and narrow the gap between the official and parallel markets.

The Central Bank recently restored access for licensed BDCs to the official foreign exchange market. The move aims to boost dollar liquidity in the retail segment and reduce persistent pressure in the parallel market.

In a circular dated February 10, the CBN stated that all duly licensed BDCs are permitted to purchase foreign exchange from the NFEM through any authorised dealer bank at prevailing market rates.

Earlier, in September 2025, the apex bank confirmed that 82 BDC operators had been fully licensed to commence operations from November 27 under its revised regulatory framework for Nigeria’s foreign exchange market.

Under the framework, authorised dealer banks are required to conduct comprehensive know-your-customer checks and due diligence on their BDC clients in line with regulatory standards and internal risk management procedures. Upon satisfactory completion, banks may sell foreign currency to BDCs for eligible retail transactions, subject to a weekly cap of $150,000 per bureau.

The Central Bank said the measure is intended to ensure adequate foreign exchange supply for legitimate end-user needs, particularly retail transactions, amid past volatility in the naira and widening spreads between official and informal market rates.

The guidelines also impose strict utilisation controls. Any foreign exchange purchased but not deployed must be resold into the market within 24 hours, as BDCs are prohibited from holding open positions in funds sourced from the official window. Licensed operators must submit timely and accurate transaction returns electronically to the regulator.

Accounts with approved financial institutions must be used exclusively for all settlements. In an effort to restrict cash-based foreign exchange activity and improve transparency, third-party settlements are prohibited and cash transactions are limited to 25% of each transaction.

CBN's director of the Trade and Exchange Department, Musa Narkoji, signed the regulations, which are effective immediately.

The change in policy represents a major reassessment of the Central Bank's foreign exchange policy. Following years of restrictions, it legally reintegrates BDCs into the market as authorities work to stabilise the naira, enhance price discovery, and restore trust in Nigeria's disjointed foreign exchange system.