FATF Exit and Naira shaped market sentiment as the week began in Nigeria.
The currency strengthened slightly against the US dollar, showing early signs of stability.
It traded near ₦1,441.5/$ on the official market, while the parallel market hovered similarly.
Consequently, the Naira recorded a 1.7% monthly gain and a 13.5% yearly increase.
Steady Recovery
Moreover, the Naira has recovered 6.76% in 2025, reversing sharp depreciation from previous years.
Analysts predict a stable trend, with potential further gains if conditions remain favourable.
Market Boost From FATF Exit
After Nigeria left the FATF grey list last week, markets responded positively.
Investor confidence grew, foreign reserves rose, and market activity surged.
As a result, the Naira climbed to a 10-month high of ₦1,444.4/$ as dollar holders sold off positions.
The Central Bank of Nigeria (CBN) actively implemented reforms that calmed the market and encouraged investment.
Delisting reduced payment barriers, thereby creating opportunities for business growth.
Consequently, banks and international investors now channel stronger financial inflows into Nigeria.
FATF highlights countries with weak systems to combat money laundering and illicit finance.
Read Also: Naira Slides To ₦1,444/$1 As FX Pressure Persists
It calls on all jurisdictions to conduct enhanced due diligence and adopt counter-measures for high-risk countries.
Furthermore, Nigeria, South Africa, Mozambique, and Burkina Faso completed key FATF reforms.
These countries improved their credibility with global institutions and strengthened their positions in capital markets.
Factors Affecting Naira
The CBN narrowed the gap between official and parallel FX rates through liquidity injections.
It eased monetary conditions, reduced speculation, and boosted investor confidence significantly.
Meanwhile, rising global oil prices support Nigeria’s FX inflows from crude exports.
Additionally, remittances and portfolio investments are increasing as global risks ease gradually.
However, inflation remains high at 20.1%, reducing purchasing power and increasing demand for dollars.
Supply gaps in FX may widen spreads due to imports, tuition fees, and external debt.
At the same time, a strong US dollar and volatile pound—₦1,890–₦2,030/£—could pressure the Naira.
Overall, the Naira’s trajectory looks steadier now, thanks to reforms and renewed investor confidence.
