Naira Touches N1320, Outlook Positive as FX Reserves Hit $53.5bn
The Nigerian naira opens the new month strong, driven by robust foreign-currency liquidity in the official window and supported by growing market confidence.
The local unit closed at N1332 per dollar at the official window in August, gaining N36 from N1368 per dollar in the equivalent period in July.
During the last trading session in August, the official rate appreciated to its strongest level against the dominant US dollar since the FX reforms.
Financial institutions’ forex market activities have been heavier in August, but the energy has been effectively matched by the strength of the supply side.
Foreign portfolio investors, exporters/importers, and non-bank corporates continue to drive energy supply at the official window, with the Central Bank’s periodic FX intervention serving as a shock absorber.
OMO bill investments by foreign portfolio investors have influenced the exchange rate direction, analysts said in a chat with MarketForces Africa, adding that the inflows have effectively boosted FX market supply.
With $53.5 billion in gross external reserves, analysts said the local unit could beat the N1350 year-end target and appreciate significantly to the N1200-N1300 range in 2026.
Nigeria’s gross external reserves continue to rise as geopolitical tensions drive up energy costs worldwide. Oil-linked African nations have effectively bolstered their hydrocarbon revenues, while improved fiscal performance has aided local currency appreciation.
The nation’s gross foreign exchange reserves, excluding gold, Special Drawing Rights, and the position at the International Monetary Fund, increased to around $44.4 billion in June 2026 from $31.2 billion a year earlier, now covering around six months of imports and exceeding our expectations, Moody’s said in its latest report. CBN Reduces Rates on Nigerian OMO Bills, Raises N1.9trn
