The naira extended its rally on Wednesday, closing at ₦1,341.99/$ at the official market.
As a result, it reached its strongest level since February 18, data from the Central Bank of Nigeria shows.
Naira Rally Continues
At the start of the week, the currency traded at ₦1,358/$ on Monday, signalling early recovery.
It then strengthened to ₦1,348/$ on Tuesday, maintaining steady upward momentum in the market.
By Wednesday, the naira climbed to ₦1,341.99 /$, confirming consistent gains over three sessions.
Meanwhile, week-on-week data shows the currency improved from ₦1,369/$ recorded on April 8.
This trend indicates rising confidence and improving stability at the official foreign exchange window.
Market Pressures Remain
However, Nigeria’s external reserves declined to $48.72 billion as of April 13.
Earlier, they stood at $49.18 billion at the beginning of the month, showing a gradual drop.
At the same time, the parallel market shows persistent volatility and a widening gap with official rates.
Reports by analysts link this gap to speculation, arbitrage and fiscal leakages.
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Traders say weak liquidity and strong speculative demand continue to widen the gap between both markets.
Therefore, experts stress the need for stronger FX inflows and clearer policies to close the disparity.
Global Cues And Outlook
Globally, external developments also support the naira’s recent performance in foreign exchange markets.
For instance, the US dollar remained weak amid improved sentiment over possible US-Iran talks.
Typically, a softer dollar supports emerging market currencies, including the naira.
Meanwhile, oil prices remain elevated due to tensions around the Strait of Hormuz.
Brent crude trades near 94.87 dollars/$, while US crude hovers around $91.39.
Consequently, higher oil prices may boost revenues but also increase inflationary pressures.
Recent data highlights ongoing economic pressures despite the naira’s short-term gains.
Notably, the International Monetary Fund cut Nigeria’s 2026 growth forecast to 4.1%.
Inflation rose to 15.38% in March, up from 15.06% in February.
