The Nigerian Naira commenced the first week of 2026 on a positive note, recording gains against major global currencies in both the official and parallel foreign exchange markets. This upward movement continues the currency's stable trajectory established throughout the previous year.
Market Performance on January 5
In the Nigerian Autonomous Foreign Exchange Market (NAFEM), which serves as the official window, the Naira appreciated against the US Dollar. It gained N1.54 or 0.11% to close at N1,429.31/$1, an improvement from the N1,430.85/$1 rate recorded in the previous trading session.
The strength was not limited to the Dollar. Against the British Pound Sterling, the Naira rose by N5, finishing at N1,920.27/£1 compared to N1,925.78/£1. A more significant gain was seen against the Euro, where the local currency appreciated by N10.80 to settle at N1,667.43/€1, up from N1,687.24/€1.
Parallel Market and Broader Stability
The positive sentiment extended to the unofficial black market, where the Naira also gained ground. It appreciated by N5 against the US Dollar, trading at N1,470/$1 compared to N1,475/$1 previously. However, at the forex counter of GTBank, a slight depreciation of N3 was observed, with the rate moving to N1,438/$1 from N1,435/$1.
This performance indicates that the Naira has carried forward the stability it enjoyed in 2025, marking a sharp contrast to the high volatility that characterized the market in 2024. The currency appreciated by 7.4% year-on-year, closing 2025 at the N1,429/$1 level.
Analyst Outlook and Supporting Factors
Financial analysts attribute this sustained stability to strategic interventions by the Central Bank of Nigeria (CBN). These measures are bolstered by rising external reserves and consistent inflows from Foreign Portfolio Investments (FPIs). Market observers expect the CBN to maintain its proactive approach in the FX market to boost liquidity and curb speculative activities that could trigger volatility.
Aminu Gwadabe, President of the Association of Bureau De Change Operators of Nigeria (ABCON), commented on the trend. He noted that the Naira's consistent stability reflects the successful alignment of the official and parallel market rates. He added that interestingly, the parallel market rate is now trading lower than the interbank proceeds sold to BDC operators.
Improved Continental Standing
A significant outcome of this recovery is the Naira's exit from the list of Africa's ten worst-performing currencies towards the end of 2025. It had remained on that bottom-ten list for nearly two years prior. Analysis indicates the currency exited the list in October 2025 and had not reappeared as of December, supported by policy reforms and improved FX liquidity. The Naira is now estimated to rank among Africa's 15th to 20th weakest currencies, a notable improvement.
Other notable exchange rates as of January 5 include:
- CFA Franc: N2.56
- Chinese Yuan: N204.60
- British Pound: N1,920.27
- Euro: N1,667.43
- Saudi Riyal: N381.09
- South African Rand: N86.59
The continued stability of the Naira is seen as a critical indicator of confidence in the Nigerian economy, with all eyes on the Central Bank's next moves to sustain this positive momentum.
