Market News

By Oluwakemi Abimbola

The naira on Tuesday recorded its strongest performance of the year at the official Nigerian Foreign Exchange Market, appreciating by 1.25 per cent to close at N1,401.22 per dollar.

Data obtained from the Central Bank of Nigeria website on Tuesday evening indicated that the local currency gained N17.73 compared to the N1,418.95/$ recorded at the close of trading on Monday.

This significant leap marks a major strengthening for the naira, which had hovered between 1,417 and 1,422 to the dollar for the better part of the last two weeks. The new rate of 1,401.22/$ is the strongest the currency has traded since the beginning of 2026, signalling a potential shift in market liquidity.

According to the NFEM daily exchange rate figures, the market on Tuesday recorded an intra-day high of 1,415. This intraday volatility highlights the ongoing price discovery process in the official window.

However, the closing rate suggests a strengthening of the Naira’s position as it inches closer to the N1,400 psychological support level.

Industry analysts had projected that the naira would trade within a predictable range in the coming week, with movements largely dictated by FX supply conditions and liquidity dynamics in the official market.

At the start of the week, analysts at AIICO Capital said, “Barring any significant shift in supply, we expect the Naira to trade within a similar range, supported by steady inflows and reserve accretion.”

Conversely, experts at Cowry Assets Management projected continued pressure in the near term, noting that “the naira is expected to remain under pressure due to FX demand and structural imbalances, though rising external reserves may provide some support.”

Tuesday’s sharp appreciation marked a three-day winning streak for the local currency. On Friday, 23 January, the currency stood at N1,421.63 before gaining marginally on Monday to N1,418.95 and finally recording its biggest jump on Tuesday.

This trend is a reversal of the depreciation observed between 21 and 22 January, when the naira hit its lowest point of the period at N1,422.07/$.

Meanwhile, the naira also appreciated in the parallel market. According to Cowry Assets, the domestic currency rose by 0.33 per cent to N1,476/$, reflecting improved sentiment across both the regulated official segment and the informal foreign exchange market.