The Nigerian naira ended May 2026 at N1,372 against the United States dollar, marking a relatively stable performance despite ongoing global economic uncertainties. Although the local currency recorded a slight decline of 0.36% from the N1,367/$ exchange rate recorded at the end of April, analysts say the broader picture points to growing confidence in Nigeria’s foreign exchange market.
A year-on-year comparison paints a more positive outlook for the naira. Data from the Central Bank of Nigeria (CBN) showed the currency gained N213.50 against the dollar when compared to the N1,585.50/$ recorded in May 2025. The 13.5% appreciation highlights the impact of recent monetary reforms, improved foreign exchange liquidity, and increased investor participation in the market.
Throughout May, the naira traded within a relatively narrow range, signaling a period of stability after months of sharp fluctuations. The currency opened the month at N1,367.50/$ and strengthened to N1,358.01/$ on May 7, its strongest level during the period. It later traded mostly between N1,372/$ and N1,375/$ before closing the month at N1,372/$, suggesting that market pressures remained largely under control.
Market observers attribute the currency’s resilience to stronger FX inflows, improved external reserves, and the continuation of reforms aimed at enhancing transparency in the foreign exchange market. The stable performance follows gains recorded in April and marks the second consecutive month in which the naira has managed to preserve its value, raising hopes that exchange rate volatility may be gradually easing.
Supporting this trend is the Central Bank’s decision to maintain a tight monetary policy stance. At its most recent Monetary Policy Committee meeting, the apex bank retained the Monetary Policy Rate at 26.5%, while leaving the Cash Reserve Ratio for commercial and merchant banks unchanged at 45% and 16% respectively. The CBN said the move was necessary to sustain progress in inflation control and strengthen stability in the foreign exchange market, a development closely watched by businesses, investors, and consumers alike.
source: nairametrics