The Nigerian naira strengthened to N1,349.5 per US dollar on Tuesday, marking the first time it traded below the N1,350/$ threshold since May 29, 2024. Data from the official foreign exchange market showed an improvement from N1,354.9 per dollar recorded on Monday, reflecting growing stability in the official currency window.
Analysts attribute the recent appreciation to stronger foreign exchange inflows, improved market confidence, and a rise in the country’s external reserves. Abuja-based economist Dr. Joseph Mbada noted that the strengthening reflects better liquidity conditions in the official market, saying, “Supply conditions have improved significantly due to higher inflows and tighter monetary policy, which help moderate speculative demand.”
Despite gains in the official market, the parallel or “street” market remained weaker, with the naira trading at N1,443.68 per dollar on Tuesday. The gap between official and unofficial rates, while narrowing, highlights ongoing pressure in the parallel market and the challenges the Central Bank of Nigeria (CBN) faces in fully stabilizing the currency.
Rising oil export earnings, steady remittance inflows, and portfolio investments have helped boost dollar supply, contributing to the naira’s appreciation. Experts suggest that the strengthening currency and increasing reserves provide the CBN with stronger buffers to manage volatility and defend the naira when necessary.
The movement comes ahead of the CBN’s 304th Monetary Policy Committee (MPC) meeting, scheduled for February 23–24, 2026. Policymakers are expected to review inflation trends, liquidity conditions, and developments in the foreign exchange market. At its November 2025 meeting, the MPC retained the monetary policy rate at 27 per cent, maintaining a tight policy stance to curb inflation and support currency stability.
source: nairametrics