By M10News Dayo Olusola 12 Oct 2025
Naira Ends Week on Strong Note
The Nigerian Naira recorded a sharp gain against the United States dollar on Friday, closing the week with renewed momentum amid a steady increase in the country’s external reserves.
Fresh figures released by the Central Bank of Nigeria (CBN) showed that the Naira appreciated to ₦1,455.17 per dollar at the official foreign exchange window.
This marks a significant improvement from Thursday’s closing rate of ₦1,466.65, representing a day-to-day gain of ₦11.48—one of the strongest performances in recent weeks.
Data Points to Renewed Market Confidence
Market analysts say the currency’s rally reflects growing investor confidence in the economy.
They attribute the positive sentiment to the Central Bank’s monetary tightening measures and consistent inflows into Nigeria’s foreign reserves.
The strong showing also aligns with the regulator’s efforts to stabilise the FX market through targeted interventions and stricter liquidity management.
Foreign Reserves Continue Upward Trend
According to the CBN, Nigeria’s foreign reserves climbed to $42.58 billion as of October 9, 2025.
This represents an increase from $42.40 billion recorded a week earlier on October 2, underscoring a sustained improvement in external buffers.
Economists view the rising reserves as a positive signal of stronger balance-of-payments support and growing investor inflows.
Parallel Market Also Shows Gains
The local currency also strengthened in the parallel (black) market, where it traded at ₦1,503 per dollar on Friday.
That figure was slightly stronger than Thursday’s ₦1,505, continuing a consistent upward trend across both official and unofficial trading windows.
Analysts say the narrowing gap between the two rates suggests growing stability in the FX ecosystem.
Factors Behind the Rally
Currency experts attribute the Naira’s rise to a combination of CBN interventions, higher oil earnings, and increased diaspora remittances.
They note that stronger inflows have eased pressure on the foreign exchange supply side, boosting overall liquidity.
“The rise in reserves has helped restore market confidence and supported a more balanced exchange rate movement,” said one Lagos-based economist
Strongest Performance in Over a Week
Friday’s trading marked the Naira’s best performance in over a week.
The last time it traded near this level was on October 3, when it closed at ₦1,455.24 per dollar.
The rebound signals what market watchers describe as a “positive technical correction” after months of volatility.
Inflation and Price Stability Outlook
Economists believe that a sustained appreciation of the Naira could help ease inflationary pressures in the coming months.
A stronger currency reduces import costs, particularly for manufacturers and consumer goods producers dependent on foreign inputs.
Analysts warn, however, that gains must be consolidated through fiscal discipline and stronger export performance.
Calls for Policy Consolidation
Financial experts are urging the federal government to safeguard the Naira’s recent progress.
They recommend policies aimed at curbing speculative trading and ensuring productive dollar inflows through non-oil exports.
“The CBN can only do so much,” said another analyst. “Fiscal authorities must complement monetary actions with credible reforms to sustain confidence.
Market Stability Improves
The combined gains in both the official and parallel markets have improved overall sentiment in the FX landscape.
Traders report fewer instances of panic buying and note that liquidity conditions are slowly normalising.
This improvement, they say, could pave the way for a more transparent exchange regime in the months ahead.
Stronger Outlook for Financial Stability
Economists suggest that the twin rise in external reserves and exchange rate stability signals a potentially more resilient economy.
If maintained, the trend could strengthen Nigeria’s fiscal position and enhance investor confidence in local assets.
“The signs are encouraging,” one economist told M10News. “But the key test will be whether these gains hold through Q4.”
M10News Business Desk | Contact: business@m10news.com
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