Figures cited by Vanguard show that the Nigerian Naira has maintained a steady performance against the US Dollar in the official window, opening at N1,351.13 this Wednesday. This stability is being attributed to the Central Bank of Nigeria’s (CBN) consistent market interventions and the current high-interest-rate environment, which has discouraged speculative hoarding. The spread between the official and parallel markets has narrowed to less than 1.5%, a historic low for the currency.
In the parallel market, the dollar is trading between N1,355 and N1,365, reflecting a calm sentiment among currency traders in major hubs like Lagos and Kano. Financial analysts point out that the absence of “unpredictable swings” is a result of improved dollar liquidity in the Nigerian Foreign Exchange Market (NFEM). The CBN’s transparent price discovery mechanism has helped restore some level of confidence among international investors and local manufacturers.
Despite the stability, the high Monetary Policy Rate (MPR) of 26.50% continues to place a strain on borrowing for local businesses. While the strong Naira helps keep imported inflation in check, the cost of capital remains a significant hurdle for expansion. The federal government has expressed optimism that the Naira will appreciate further to the N1,000 mark as oil exports increase and diaspora remittances continue their upward trajectory.
The currency’s performance was also tracked by The Guardian and ThisDay. The Guardian noted that “The convergence of the rates is a significant milestone for the Tinubu administration’s exchange rate unification policy.” ThisDay quoted a lead economist saying, “The Naira’s current stability is fragile but sustainable if oil production targets are met.”
Echotitbits take:
The “Naira-Dollar War” seems to have entered a period of truce. The convergence of rates is great for transparency, but the high interest rates required to sustain this are killing small business growth. Watch the NNPCL’s oil production figures—if they dip, this stability could vanish overnight.
Source: The Punch – https://punchng.com/inflation-plunges-as-reforms-anchor-naira-stability/, February 25, 2026
Photo credit: The Punch
