Nigeria’s naira strengthened to N1,382.63 per dollar on improved liquidity and rising foreign exchange inflows, despite declining external reserves

Nigeria’s naira showed renewed strength on Tuesday, March 24, 2026, closing at N1,382.63 per dollar at the Nigerian Foreign Exchange Market (NFEM), up from N1,388.38 the previous day.

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The rebound reflects a 0.42% increase (N5.75) and comes amid improved market liquidity and strong foreign exchange inflows, signalling temporary easing of pressure on the official FX window.

In the parallel market, the naira remained stable at N1,415 per dollar, though the gap between official and black market rates widened to N33 from N27, indicating lingering inefficiencies.

Data from FMDQ Group showed foreign exchange inflows rose 45% month-on-month to $4.4 billion in February, driven largely by foreign portfolio investors attracted to Nigeria’s high-yield environment.

Despite this momentum, Nigeria’s external reserves fell for the sixth straight session to $49.60 billion as of March 23, 2026, down 0.84% from earlier levels.

However, analysts highlight the strength of Nigeria’s net usable reserves, which surged from $3.99 billion at the end of 2023 to $34.80 billion by late 2025, providing a stronger buffer for FX intervention.

Gross reserves remain above $45 billion, covering nearly ten months of imports.

Structural reforms—including FX market unification, subsidy removal, legacy obligation settlements, and tighter monetary policy—have improved liquidity, encouraged inflows, and strengthened policy credibility.

The Central Bank’s increased gold reserves, rising from $2.6 billion in late 2025 to $3.5 billion in early 2026, have further diversified reserves and bolstered confidence in the naira.

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In February 2026, the naira appreciated by 4.13%, demonstrating resilience despite efforts by the Central Bank of Nigeria to slow its momentum through strategic dollar purchases.