Naira Crushes Dollar Again As New Rate Emerges

Excitement has erupted among many Nigerians as President Tinubu’s economic policies begin to deliver promising results.

The Central Bank of Nigeria (CBN) has implemented stricter controls while maintaining a lower exchange rate at official windows.

However, the limited access and stringent allocation restrictions have compelled numerous importers, businesses, and students seeking to study abroad to resort to the parallel market.

Data from the Central Bank of Nigeria (CBN) showed that the naira rose to N1,506.08 to a dollar on Wednesday at the Nigerian Foreign Exchange Market (NFEM). The last time it was that strong was on the 5th of March, 2025, when it closed at N1,500.80/$.

The naira has continued to enjoy rare stability, driven by the various policies of the apex Bank, including maintaining a high interest rate, a move that has lured in foreign capital and made the currency firmer.

Nigeria’s naira has witnessed some turbulence years after the authorities relaxed currency controls, effectively floating the currency to be more determined by market forces. That saw the unit fall by over 70 percent and disrupted business plans of many firms in Africa’s most populous nation.

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But those eras of sharp swings are phasing out as the local currency is expected to continue its rally until the end of the year, with global investment bank JP Morgan forecasting the naira to close 2025 at N1,450 per dollar.

A potential rate cut by the United States Federal Reserve also bodes well for the naira’s long-term stability as global capital finds its way into emerging markets like Nigeria, further bolstering the calmness of the currency.

“A lower US interest rate would diminish the relative attractiveness of US assets, prompting global investors to seek higher returns in emerging markets like Nigeria. Consequently, Nigeria will likely experience increased portfolio inflows, particularly into the fixed-income market,” analysts at FBNQuest Merchant Bank wrote in a note recently.

“Renewed interest by offshore investors could potentially bolster foreign exchange reserves and support the stability of the Naira.”

FX reserves seen rising further on likely US rate cut