The Nigerian Naira continued its upward trajectory against the US dollar during midweek trading, hitting monthly highs in the official foreign exchange market. On Wednesday, the exchange rate in the Nigerian Foreign Exchange Market (NFEM) settled at approximately N1,400.66 per dollar, extending gains recorded earlier in the week, when the naira closed at N1,401.2/$.
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Analysts observed that the parallel market responded more cautiously to the naira’s rapid appreciation, with rates in Lagos’ Bureau De Change ranging between N1,475/$ and N1,490/$. The average buy and sell rates stood at N1,480/$ and N1,490/$, respectively, reflecting a narrowed premium compared to recent volatility.
The Central Bank of Nigeria’s regulatory reforms and increased foreign exchange liquidity have been credited for the naira’s steady performance. The currency has maintained momentum into early 2026, building on a strong 2025, during which the naira recorded a decade-high appreciation of 7–9% against the US dollar.
Global currency markets also contributed to the naira’s gains, as the US dollar weakened to its lowest level since early 2022. Speaking at a press conference in Iowa, US President Donald Trump dismissed concerns about the dollar’s decline, stating, “No. I think it’s great. I think the value of the dollar was great.”
Following the remarks, the dollar index fell by 1.2%, reflecting investor anxiety over US debt levels, trade policies, and political instability. Analysts note that the dollar’s decline has been fueled by a combination of Trump’s unconventional policies, including aggressive trade strategies, tax cuts, and challenges to the Federal Reserve, alongside a rebound in the Japanese yen.
Despite rising US government bond yields and expectations that the Federal Reserve may pause interest rate cuts, the dollar continues to face pressure. Investors are increasingly shifting to alternative assets, such as gold—which has reached record highs—and emerging-market funds, a trend some describe as a quiet rotation away from US holdings.
The naira’s appreciation amid global dollar weakness offers temporary relief for Nigerian importers and investors, but experts warn that sustained gains will depend on continued regulatory support, FX liquidity, and global currency dynamics.
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