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| Naira Per Dollar |
Naira starts September strong at N1,526 per dollar, marking its best performance in six weeks. Experts predict stability supported by CBN reforms and FX inflows.
Naira Gains Strength in Early September
The naira started September on a strong note, trading at N1,526.09 per dollar, an appreciation of 0.36% (N5.48) from the previous rate of N1,531.57 per dollar. This marks the strongest performance of the Nigerian currency in nearly six weeks on the official Nigerian Foreign Exchange Market, according to the Central Bank of Nigeria.
At the parallel market, the naira also performed impressively. Research from Cardinal Stone showed it gained 1.22% to settle at N1,527.33/$, a movement that helped reduce speculative trading activities.
Expert Projections on the Naira Exchange Rate
Financial analysts had projected a strong start for the naira this week, and the performance aligns with their outlook.
- Cowry Assets Management forecasted that the naira would remain largely stable in the official window. This stability is expected to be driven by CBN interventions and modest FX inflows.
- AIICO Capital also projected that the naira would trade within the 1,525–1,538/$ band throughout the new week.
- A recent report by PwC Nigeria highlighted that the naira is expected to remain broadly stable through 2025, underpinned by CBN reforms and improved portfolio inflows.
These consistent forecasts strengthen investor confidence and suggest that the exchange rate will avoid major volatility in the short term.
Recent Performance of the Naira
Looking back, the naira has shown signs of resilience in recent weeks:
- On Friday, the currency closed at N1,531.57/$, marking a 0.23% appreciation compared to the previous week.
- On a month-on-month basis, it appreciated by 0.13%, moving from N1,533.55/$ at the end of July to N1,531.57/$ in August.
- This reversed the weaker performance recorded at the end of July, when the naira closed at N1,533.55/$, down by 0.25% from June’s close of N1,529.71/$.
Such steady improvements are a signal that the naira is finding stronger ground after months of fluctuations.
Factors Supporting the Stronger Naira
Experts attribute the strengthening of the naira to multiple factors that have boosted investor confidence and liquidity in the market:
- Improved market liquidity due to CBN reforms.
- Sustained dollar inflows from portfolio investors and exports.
- Rising external reserves, which stood at $41.27bn as of Friday, an increase from $41.00bn at the start of August.
These factors combine to create a healthier environment for currency stability, further reinforcing the positive trend seen in September.
Global Dollar Trends and Impact on the Naira
On the international front, the U.S. dollar fell to a five-week low as investors anticipate key U.S. labour market data. The report from Reuters suggests that weaker labour market performance in the U.S. could influence Federal Reserve decisions on monetary easing.
Analysts argue that the U.S. economy is no longer outperforming as it did in past years. A softer dollar globally could continue to support the naira and other emerging market currencies.
What This Means for Nigerians and Investors
The strengthening of the naira has positive implications for businesses, importers, and the general public:
- Importers may face reduced costs due to a stronger exchange rate.
- Investors gain increased confidence in Nigeria’s financial market stability.
- Households could benefit indirectly through lower inflationary pressures if the stability is sustained.
This is a crucial period for businesses planning their budgets, as the consistency of the exchange rate offers a more predictable environment.
A Strong Start to September for the Naira
The naira starts September strong at N1,526 per dollar, marking its best performance in six weeks and offering optimism for continued stability. With improved FX inflows, rising external reserves, and consistent CBN reforms, experts project that the currency will remain steady in the near term.
Stay updated on naira performance and foreign exchange rates by visiting the Central Bank of Nigeria’s FX portal and following trusted sources like BusinessDay Nigeria for real-time economic updates.
