Naira Exchange Rate Trends
Before the fluctuations in June 2023, the official exchange rate at the Central Bank of Nigeria’s Investor and Exporter (I&E) window was about ₦420 to ₦460 per US dollar.
However, rates in the parallel market were much higher, often hitting between ₦750 and ₦780 per dollar. This highlights a notable difference between what’s officially reported and the real market situation.
Looking ahead to February 2024, there are reports that the black market price for a dollar is nearing 2,000 naira, with an all-time low of 1,900 naira recorded.
Current information shows that the naira reached a level that hasn’t been seen in nearly a year, trading below the 1,500 naira to the dollar mark on the official market throughout October.
On the 17th of each month, the naira dropped to a low of 1,475.35/$. Now, it’s trading higher at 1,421.73 per dollar.
According to Cardinal Stone, the local currency ended last Friday at 1,450.00 naira to the dollar, indicating that the parallel market conditions aren’t drastically different.
An analysis from AIICO Capital noted that the Nigerian naira appreciated this week as market liquidity improved and demand pressures eased. This was aided by better foreign exchange supplies, particularly as foreign portfolio investors sold off their US dollar positions.
The consistent inflow of foreign funds has bolstered supply across key benchmarks, enabling the Naira to climb—closing at N1,421.73/USD with a week-on-week increase of 2.48%.
Correspondingly, foreign exchange reserves have also seen a rise.
Data from the Central Bank indicates that reserves grew from $42.35 billion on September 30, 2025, to $43.17 billion by October 30, 2025.
A recent macro study by CSL Research attributes the stabilization of the naira to increased output from the Dangote refinery.
CSL Research Macronote on Dangote Refinery and Naira
The primary factor driving this positive turn appears to be the resilience of the external sector, despite a relative softness in global oil prices. Recent analysis shows that the current account balance recorded a surplus of about $5.3 billion in Q2 2025, up from $2.9 billion in Q1 2025.
The report suggests that a significant drop in imports, combined with a modest rise in export earnings, has alleviated pressure on foreign exchange demand, allowing the naira to appreciate. They believe the increase in domestic oil production, primarily from the Dangote refinery, plays a crucial role in this.
Concerns raised by global institutional investors regarding unhedged naira positions were also highlighted.
The report further estimated that offshore investors who engaged in one-year OMO securities in late 2024, when the average stop rate was around 24% and the exchange rate hovered around N1,650/$1.650, saw a net return of approximately 36% in US dollar terms at current rates.
This lucrative opportunity has heightened interest from foreign investors in Nigerian assets, which has also contributed to stabilizing the foreign exchange market.
Finally, CSL Research remarked that ongoing interventions by the CBN are helping to maintain local currency performance in light of rising offshore inflows and a strengthening trade balance.
