The naira experienced a significant rebound this week across both the official and parallel foreign exchange (FX) markets.
Data from the Central Bank of Nigeria (CBN) shows that the currency closed on Friday at N1,488/$1, up from N1,490/$1 on Thursday.
The data further shows that, at the official market, the naira opened the week at N1,495/$1 on Monday, appreciating slightly to N1,485.05/$1 on Tuesday.
The currency, however, slipped back to N1,498/$1 on Wednesday before recovering to N1,490/$1 on Thursday.
Compared to last week Friday’s closing rate of N1,503.5/$1, the naira showed marginal improvement, suggesting cautious optimism among traders and market participants.
Naijaonpoint reports that during the week, the currency surged to a five-month high of N1,497.5/$ at the first trading session of the week in the official market, supported by better foreign exchange (FX) liquidity and less demand pressure.
The gains were not isolated to the official window. The parallel market also witnessed appreciation of the Naira during the week.
It traded at N1,520/$1 on Friday, a notable improvement from N1,530.5/$1 on Thursday. This is up from N1,537/$1 recorded on Wednesday.
This performance indicates a narrowing gap between the official and parallel rates.
During the week, Nigeria’s foreign exchange reserves closed the week at $41.9 billion. This represents an increase from last week’s $41.6 billion.
This is according to figures published by the Central Bank of Nigeria (CBN) on its website.
Essentially, FX reserve movements are particularly crucial for economic stability, currency strength, import capacity, debt management, and overall investor confidence.
Several experts have attributed the renewed rally of the naira to several factors, with many predicting further appreciation.
In an exclusive chat with Naijaonpoint, Zeal Akaraiwe, CEO of Graeme Blaque Advisory, cited the structural reforms that laid the groundwork for the naira’s recovery.
“We have to understand the impact of the market initiatives that started last year to strengthen the fundamental foundation of the FX market, which culminated with the launch of the BMatch system as well as the FX Code,” Akaraiwe said.
Professor Murtala Sagagi, a member of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria, expressed optimism about the naira’s future, predicting it could strengthen to around N1,400 against the US dollar by the end of 2025.
Professor Murtala Sagagi, a member of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria, expressed optimism about the naira’s future, predicting it could strengthen to around N1,400 against the US dollar by the end of 2025.
His prediction is supported by encouraging events, including a rise in foreign investment, an improvement in the balance of payments, and a daily increase in crude oil production. These observations were made at the July meeting of the Monetary Policy Committee (MPC), and the CBN made the information public on September 12.
“With the recent increase in daily crude oil production, new inflows of capital, and an improved balance of payments, it is likely that the naira will continue to appreciate, potentially reaching the projected N1,400 per dollar before the end of the year,” Sagagi stated
Naijaonpoint reported that experts have projected that the CBN will lower the Monetary Policy Rate (MPR) by 25 – 50 basis points at its 302nd meeting scheduled for September 22–23, 2025, citing easing inflation, naira stability, and global monetary trends as key drivers.
Headline inflation eased for the fifth consecutive month in August 2025, marking the steepest moderation since April.
The August 2025 rate of 20.12% reflects a significant slowdown compared to July’s 21.88%, driven by softer food and energy prices.
This trend, analysts say, suggests that earlier monetary tightening, fiscal adjustments, and improved supply dynamics are taking effect.
The naira has traded within a N1,440/$ – N1,600/$ band in the official market since February this year, buoyed by improved foreign portfolio inflows, steady oil earnings, and targeted CBN interventions.
At its 301st Monetary Policy Committee (MPC) meeting held in July, CBN voted unanimously to maintain the MPR at 27.5%.
The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, projected a future decline in interest rates, citing easing inflation and improved capital allocation efficiency as key drivers.