The Nigerian naira recorded a slight depreciation on Tuesday, settling at N1,383.5 per dollar, compared to N1,383/$ on Monday, as pressure mounts from declining external reserves and cautious global market sentiment. Despite the marginal movement, the shift reflects persistent fragility in Nigeria’s foreign exchange landscape.
According to data released by the Central Bank of Nigeria (CBN), the naira traded within a range of N1,372/$ to N1,389/$ during the day. Market activity showed moderate liquidity, with the currency averaging N1,381.86/$ across 88 interbank deals totaling $83.44 million. While trading conditions remained relatively stable, underlying pressures continue to weigh on the currency.
A key concern remains Nigeria’s external reserves, which dropped to $49.6 billion as of March 23, 2026, down from $49.8 billion recorded just five days earlier. This decline signals ongoing strain on the country’s foreign exchange buffers, limiting the Central Bank’s ability to defend the naira and stabilize the market.
Globally, currency markets are navigating a cautious environment shaped by geopolitical tensions and evolving monetary policy expectations. Ongoing developments in U.S.–Iran relations, alongside signals from the U.S. Federal Reserve about prolonged high interest rates, are influencing investor sentiment. The probability of a rate hike has increased significantly, strengthening the dollar and adding pressure on emerging market currencies like the naira.
Despite these challenges, the CBN remains optimistic about the medium-term outlook. The apex bank has reaffirmed its inflation target of 6–9% and projects external reserves to rise to $51.04 billion in 2026, supported by anticipated foreign inflows and structural reforms. However, in the near term, movements in global oil prices, capital flows, and geopolitical risks will continue to play a critical role in shaping the naira’s trajectory.
source: nairametrics