Nigeria’s naira has emerged as one of the strongest-performing currencies in Africa so far in 2026, even as global financial markets face renewed uncertainty. According to a report by United Capital Plc, the naira appreciated by 6.7 percent against the US dollar as of April 24. This performance stands in contrast to several African currencies, including the Kenyan shilling, Ghanaian cedi, South African rand, and Angolan kwanza, all of which recorded declines during the same period.
Analysts say the naira’s resilience is largely tied to policy reforms and improved foreign exchange (FX) management. Ayodele Akinwunmi, chief economist at United Capital, noted that stronger external reserves, increased FX supply, and tighter monitoring by the Central Bank of Nigeria have helped stabilize the currency. Inflows from both oil and non-oil exports have also supported the market, while transparency reforms have reduced volatility and boosted investor confidence.
However, beneath the surface, signs of pressure are beginning to show. The naira weakened slightly last week at the official market, closing at N1,364.24 per dollar, as FX liquidity tightened and reserves declined. Data from the Central Bank indicate a steady drop in external reserves, which fell to $48.44 billion in April from over $50 billion in March. At the same time, overall FX inflows into the market dropped by 7 percent, reflecting reduced participation, particularly from local investors.
Further concerns stem from weakening remittance inflows and declining market activity. According to the Central Bank, remittances dropped sharply by over 46 percent in January. Olayemi Cardoso has set an ambitious target to raise monthly remittances to $1 billion by the end of the year, introducing measures such as expanding access to Bank Verification Numbers for Nigerians abroad and improving integration with international money transfer systems. Meanwhile, interbank trading activity has slowed significantly, signaling reduced liquidity in the system.
On the global stage, developments such as the Middle East conflict are adding another layer of uncertainty. The crisis is reshaping energy markets and influencing capital flows across emerging economies. While Nigeria could benefit from higher oil prices, experts warn that inflationary pressures and external vulnerabilities may offset these gains. Overall, the naira’s performance highlights the impact of ongoing reforms, but also underscores the delicate balance between policy success and the realities of a challenging global economic environment.
source: Business day