The Nigerian naira continued its upward momentum on Friday, posting gains against the US dollar in both the official and parallel foreign exchange markets. The latest movement marks the fourth consecutive trading session of appreciation, reinforcing optimism that recent foreign exchange reforms and stronger external reserves are helping stabilize Nigeria’s currency.
The rally comes as the country’s foreign exchange reserves climbed to $52.02 billion, while higher global crude oil prices improved expectations for stronger export earnings and foreign currency inflows.
Official Exchange Rate Improves Again
According to data released by the Central Bank of Nigeria (CBN), the official exchange rate closed at ₦1,362.09 per US dollar on Friday, improving from ₦1,367.76 per dollar recorded on Thursday.
This represents a ₦5.67 daily appreciation, highlighting continued demand for the local currency and improving liquidity in Nigeria’s official foreign exchange market.
During the trading session, transactions remained within a relatively stable range of ₦1,365 to ₦1,370 per dollar, suggesting reduced volatility despite ongoing global economic uncertainty.
Black Market Also Records Gains
The appreciation was also visible in Nigeria’s parallel foreign exchange market.
Currency traders reported that the naira strengthened to ₦1,410 per US dollar, compared with ₦1,420 per dollar a day earlier, representing a ₦10 improvement.
The narrowing gap between the official and parallel exchange rates reflects improving confidence in the country’s foreign exchange market.
Weekly Performance Shows Strong Momentum
On a week-to-week basis, the Nigerian currency recorded notable gains across both markets.
- Official market: Appreciated by ₦18.19
- Parallel market: Appreciated by ₦15
The latest performance extends the naira’s positive trend as policymakers continue implementing reforms designed to improve transparency and liquidity in the foreign exchange market.
Foreign Reserves Reach $52.02 Billion
One of the strongest drivers supporting the naira is Nigeria’s growing foreign exchange reserves.
As of July 23, 2026, the country’s reserves stood at $52.02 billion, providing the Central Bank with greater capacity to support market liquidity while strengthening investor confidence.
Market analysts believe that strong reserve levels reduce pressure on the domestic currency and improve the country’s ability to manage external financial obligations.
Interbank Forex Activity Slows
Although the currency strengthened, trading activity in the interbank market moderated during the latest session.
Key market figures include:
- Interbank FX turnover declined to $334.126 million
- Previous session turnover stood at $416.420 million
- Number of completed deals fell from 198 to 122
Despite lower transaction volumes, the naira maintained its positive trajectory, indicating that improved liquidity conditions remain intact.
Analysts Expect Continued Strength
Financial analysts believe Nigeria’s foreign exchange reforms are beginning to produce measurable results.
Several factors continue supporting the naira, including:
- Improved foreign portfolio investment inflows
- Settlement of historical foreign exchange backlogs
- Strong foreign reserve position
- Better availability of US dollars in the official market
- Stable monetary policy environment
Many analysts now believe the discussion has shifted from whether the naira will weaken to how much further it could appreciate if current conditions continue.
Rising Oil Prices Provide Additional Support
Global energy markets are also contributing to Nigeria’s improving outlook.
Brent crude oil recently climbed above $100 per barrel for the first time in months after geopolitical tensions in the Middle East raised concerns over global oil supplies.
The increase followed renewed regional conflict, including military developments involving Iran and attacks on shipping routes in the Red Sea.
As one of Africa’s largest oil exporters, Nigeria generally benefits from higher crude prices through stronger export earnings and increased foreign exchange inflows.
Inflation Risks Remain
While higher oil prices may strengthen Nigeria’s foreign exchange earnings, they also present risks for the global economy.
Rising energy costs often lead to higher transportation expenses, increased fuel prices, and more expensive consumer goods. If elevated oil prices persist, inflationary pressures could remain a challenge for many economies.
For Nigeria, however, stronger oil revenues may continue providing support for the naira if export earnings remain healthy.
The Nigerian naira ended the week on a strong note, supported by improving foreign reserves, sustained foreign exchange reforms, and favorable conditions in global energy markets.
While market volatility cannot be ruled out, current indicators suggest that stronger reserves, better dollar liquidity, and higher oil prices could continue supporting the local currency during the second half of 2026.
Disclaimer: This article is intended for informational and educational purposes only. Exchange rates, foreign reserve figures, and financial market conditions may change over time. Readers should verify the latest data with the Central Bank of Nigeria (CBN) or qualified financial professionals before making investment or foreign exchange decisions.