Naira strengthens against the dollar to ₦1,421.73, marking its best close since February as investor confidence rises and inflation continues to ease

Naira strengthens against dollar as Nigeria’s currency capped a stellar week on Friday, appreciating to ₦1,421.73 per U.S. dollar at the official Investors and Exporters (I&E) window its strongest close since February and a remarkable reversal from months of volatility.

Also read: Naira Dips Third Day to N1,473.29 Per Dollar

The naira gained ₦15.23 or 1.07% against Tuesday’s rate of ₦1,436.97, extending a five-day rally that shaved nearly 2.2% off the dollar’s value in one week. The upbeat performance has rekindled investor confidence in Africa’s largest economy.

Data from the Central Bank of Nigeria (CBN) showed the local currency opened Monday at ₦1,452.79, dipped slightly to ₦1,448.20 on Tuesday, and strengthened steadily to Friday’s high.

The trend was mirrored in the parallel market, where rates eased to between ₦1,479 and ₦1,490 per dollar — down from over ₦1,500 just two weeks ago.

Trading volumes climbed 12% week-on-week at the official window, driven by rising foreign inflows, reduced dollar demand, and stabilising global oil prices.

Economists hailed the rally as a turning point for the battered naira, which had lost more than 70% of its value in 2024 following fuel subsidy cuts and pressure on foreign reserves.

Nigeria’s recent removal from the Financial Action Task Force (FATF) grey list on October 24 has also boosted sentiment.

The milestone, achieved after three years of anti-money laundering reforms, restored the country’s credibility in global markets and cut compliance costs for banks by up to 20%, unlocking around $1.2 billion in new foreign direct investment (FDI) within days.

The currency’s strength is already easing inflationary pressures. Headline inflation, which peaked at 34.2% in June, dropped to 28.1% in October, aided by cheaper imports and a 5% decline in food prices.

Analysts believe the latest surge signals a renewed phase of economic stability, as tighter monetary policies and improved fiscal discipline begin to yield results.

Also read: Nigerian Naira Falls After Week of Gains

For millions of Nigerians, the naira’s rebound offers a glimmer of hope — a sign that confidence may finally be returning to the economy.