The Nigerian naira sustained its positive momentum in the new year, appreciating marginally against the US dollar at the official Nigerian Foreign Exchange Market (NAFEM) on January 8.
Data from the market showed the naira closed at ₦1,421/$1, improving from ₦1,416/$1 recorded in the previous trading session, underscoring continued stability in the official market.
At the Investors and Exporters (I&E) window, as tracked by platforms including LEMFI and Remitly, the naira also strengthened against major international currencies.
Against the British pound, the local currency appreciated by 0.35 per cent to ₦1,983/£1, from ₦1,990/£1. The naira recorded a 0.23 per cent gain against the euro, closing at ₦1,706/€1. The currency also strengthened against the Canadian dollar, rising by 0.47 per cent to ₦1,065/C$1, compared with ₦1,070/C$1 previously.
Reserves strengthen market confidence
Meanwhile, Nigeria’s external reserves rose further to $45.624 billion as of January 6, according to data from the Central Bank of Nigeria (CBN). This represents an increase of $18 million, or 0.04 per cent, from $45.606 billion recorded a day earlier.
The current reserve level marks the first time Nigeria’s external buffers have exceeded $45 billion in over six years, providing additional support for the CBN’s ongoing efforts to stabilise the foreign exchange market and manage volatility.
Drivers of naira performance
Economists attribute the naira’s recent firming to a combination of improved foreign exchange inflows, sustained diaspora remittances, stronger oil receipts amid relatively stable global crude prices, and continued policy reforms by the CBN aimed at boosting liquidity and unifying exchange rates.
Analysts at investment firms, including CardinalStone, project that the naira could record further gains in 2026, with forecasts placing the exchange rate in the range of ₦1,350 to ₦1,450 per dollar, provided current macroeconomic trends are sustained.
“This incremental gain, though modest, signals growing confidence in the naira’s trajectory,” said a Lagos-based currency trader. “With external reserves rising and market interventions becoming more effective, importers and investors are beginning to breathe easier.”
The parallel market continues to trade at weaker levels compared with the official window, but the gap has narrowed in recent weeks, reflecting increasing convergence across Nigeria’s foreign exchange markets.
