FX: Naira rallies to N1,348/$ as dollar wobbles

The Nigerian naira has continued to gain strength against the US dollar after its recent rise. Earlier this month, the exchange rate reached about N1,389/$, but it has now improved.

At the official market, the naira appreciated slightly by about 0.3%, trading around N1,348/$ after hitting a low of N1,346.6/$ earlier in the day.

Since January 2026, the naira has strengthened significantly from around N1,440/$. This improvement is mainly due to better foreign exchange supply and regular interventions by the Central Bank.

However, the situation is slightly different in the black market. In cities like Lagos and Abuja, the dollar is still sold at a higher rate than the official market. Even so, the gap between the two rates has reduced to less than 5% due to recent monetary policies.

Frequent dollar sales to Bureau De Change (BDC) operators have helped stabilize the parallel market. Higher oil prices have also boosted Nigeria’s foreign reserves, giving the government more ability to support the naira.

Foreign investors are still interested in Nigeria because of high interest rates.

Possible future movement

If the naira strengthens further: It could rise to around N1,300/$ if it breaks below N1,340/$.

If the naira weakens: It may fall back to around N1,380/$ if it goes above N1,360/$. This could happen if demand for dollars increases or if there are political or economic shocks.

Global outlook

The US dollar is showing slight strength globally due to rising tensions between the United States and Iran. Investors are moving towards safer assets like the dollar because of uncertainty in the Middle East.

The situation is tense as Iran has pulled out of talks with the US, and concerns remain about the Strait of Hormuz, an important route for global oil supply.

Despite this, the US Dollar Index is still generally on a downward trend, suggesting the dollar may weaken in the short term.