Naira strong gain continues as the currency appreciates 13.5% year-on-year despite a marginal decline against the dollar in May 2026

Nigeria’s naira closed May 2026 at N1,372 per United States dollar, recording a marginal depreciation from N1,367/$ at the end of April but maintaining a strong year-on-year appreciation amid improving foreign exchange market conditions.

Also read: Naira Posts Positive Gain Against Dollar at Official Market

Data released by the Central Bank of Nigeria showed that the currency weakened by 0.36 per cent during the month, ending May slightly lower than its April closing rate.

Despite the monthly decline, the naira posted a significant improvement compared to May 2025, when it traded at N1,585.50/$.

The latest figures indicate that the local currency gained N213.50 against the dollar over the 12-month period, representing a 13.5 per cent appreciation.

The performance reflects growing stability in the foreign exchange market, supported by increased liquidity, ongoing reforms and stronger investor confidence.

CBN data showed that the naira opened May at N1,367.50/$ and strengthened to N1,358.01/$ on May 7, its strongest level during the month.

For much of May, the currency traded within a relatively narrow band of N1,372/$ to N1,375/$, suggesting a calmer market environment compared to previous periods of sharp volatility.

Analysts said the limited fluctuations point to a consolidation phase in the foreign exchange market following months of significant adjustments.

The naira also preserved most of the gains recorded in April, when it appreciated from N1,387/$ at the end of March to N1,374/$ by the close of that month.

Market observers attributed the improved stability to stronger external reserves, enhanced foreign exchange liquidity and sustained confidence in the reforms introduced by monetary authorities.

The positive trend has fuelled expectations that exchange rate volatility could continue to moderate in the coming months if current market conditions are sustained.

Meanwhile, the Central Bank of Nigeria maintained its tight monetary policy stance at the latest meeting of the Monetary Policy Committee.

The apex bank retained the Monetary Policy Rate at 26.5 per cent, while leaving the Cash Reserve Ratio unchanged at 45 per cent for commercial banks and 16 per cent for merchant banks.

The committee also retained the asymmetric corridor around the MPR at +500 and -100 basis points.

According to the CBN, the policy decisions are aimed at consolidating progress in curbing inflation and preserving stability in the foreign exchange market.

Also read: Naira Shows Positive Stabilisation Against Dollar, Pound

Economists said the combination of a relatively stable exchange rate and tight monetary conditions could help sustain confidence in the naira, although inflationary pressures and global economic developments remain key factors to watch.