Naira Strengthens Against Dollar, Closes at N1,597.7/$ at Official Market

Nigeria’s currency, the naira, appreciated against the US dollar at the official foreign exchange market on Monday, closing at N1,597.7/$1, according to data from the Central Bank of Nigeria (CBN). This reflects a gain of N9.3 or 0.58% from N1,607.0/$1 recorded last Friday.

Intra-day trading at the Nigerian Foreign Exchange Market (NFEM) saw the naira trade between a high of N1,605.05/$1 and a low of N1,595/$1, with an average rate of N1,600.3/$1.

The naira also showed strength in the parallel market, appreciating to N1,623/$1 on Monday, up from N1,630/$1 on Friday. This narrowed the gap between the official and black market rates to just N25.3, one of the smallest differences recorded in recent weeks.

Against the British pound, however, the naira traded at N2,113.36/£1, reflecting continued pressure from major foreign currencies.

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Analysts Point to Improved FX Supply and Reforms

Analysts attribute the naira’s recent gains to increased foreign exchange supply from the CBN, improved remittance inflows, and ongoing policy reforms.

“The narrowing spread between official and parallel market rates suggests a decline in speculative demand and growing confidence in the official FX window.”—David Omale, Lagos-based financial analyst

CBN Policy Measures Begin to Yield Results

The CBN has intensified efforts to unify exchange rates, boost dollar liquidity, and curb speculative trading. These measures are part of a broader strategy to stabilize the naira, reduce inflation, and restore investor confidence.

Speaking at the World Bank’s Nigeria Development Update launch in Abuja, CBN Governor Olayemi Cardoso emphasized the bank’s commitment to orthodox monetary policy.

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“If we stay the course on our orthodox monetary approach—which is already delivering results—we’ll see inflation moderate and interest rates ease over time.”—Olayemi Cardoso, CBN Governor

He also noted that volatility in the FX market has significantly dropped to about 0.5%, down from 4% a year ago, showing improved market stability.

Looking Ahead

The National Bureau of Statistics (NBS) is expected to release new inflation figures in the coming days. Analysts anticipate a slight drop in inflation for April, following a rise in March driven by higher fuel and food prices.

Meanwhile, the Monetary Policy Committee (MPC), during its 299th meeting in February, maintained the interest rate at 27.5%, unchanged from its previous decision in November 2024, underlining its continued focus on monetary tightening.