Naira Strengthens Below N1,450/$ as FX Market Sees Four Consecutive Days of Recovery

Naira Strengthens Below N1,450/$ as FX Market Sees Four Consecutive Days of Recovery

The Naira recorded a stronger performance this week at the official foreign exchange market, trading below the N1,450/$1 mark for four straight days—its most stable run in weeks—following sustained pressure that kept the currency above that threshold throughout the previous trading week.

Daily figures released by the Central Bank of Nigeria (CBN) show a gradual but consistent appreciation of the currency across all five trading sessions.

The Naira opened on Monday at N1,452/$1 and strengthened further to N1,441/$1 on Tuesday. The modest recovery continued midweek, with Wednesday closing at N1,442/$1 and Thursday improving to N1,445.9/$1. By Friday, the Naira settled at N1,446.9/$1, extending its four-day streak below the N1,450 range.

Week-on-Week Comparison

This week’s gains mark a clear reversal from last week’s volatility, when the Naira recorded one of its weakest performances in recent months.

According to CBN data, the currency traded above N1,450/$1 for all five days of the previous week. It opened at N1,447/$1 on Monday but quickly lost ground, sliding to N1,458/$1 on Tuesday. Although it recovered slightly to N1,451/$1 on Wednesday, the bounce was short-lived as it fell again to N1,459.95/$1 on Thursday before closing at N1,458/$1 on Friday.

This week’s closing rate of N1,446.9/$1 therefore represents a notable firming from last week’s N1,458/$1 close.

MPC Retains Key Policy Rates

The Monetary Policy Committee concluded its 303rd meeting this week, voting unanimously to maintain all key monetary indicators. The decision underscores the CBN’s strategy to sustain price stability and support the recent improvements in the foreign exchange market.

The committee retained:

• Monetary Policy Rate (MPR): 27%
• Cash Reserve Ratio (CRR):
  • 45% for Deposit Money Banks
  • 16% for Merchant Banks
• Liquidity Ratio: 30%
• Asymmetric Corridor: +50/-450 basis points around the MPR

The CBN noted that the restrictive stance remains essential to anchor inflation expectations and attract foreign inflows.

Headline inflation eased to 16.05% in October, down from 18.02% in September, while food inflation moderated to 13.12%. Core inflation also declined to 18.69%, driven by tight monetary conditions, improved food supply, a more stable exchange rate, and a surplus current account.

CBN Governor Olayemi Cardoso said maintaining policy rates was necessary to consolidate gains in the FX market, deepen transparency, and reinforce the broader economic reform agenda.

About Author