Naira to Remain Steady as Speculation Declines, Says MPC

Naira to Remain Steady as Speculation Declines, Says MPC

The naira is expected to maintain its recent stability in the medium term as speculative activities in the foreign exchange (FX) market continue to ease, members of the Monetary Policy Committee (MPC) have projected.

At its July 2025 meeting, the MPC noted that improved FX liquidity and a reduction in currency hoarding by market speculators have provided support for the naira, helping it resist volatility pressures seen earlier in the year.

The local currency on Monday, September 15, climbed to a five-month high of N1,497.46 per dollar at the official Nigerian Foreign Exchange Market (NFEM). This marks its strongest level since March 4, 2025, when it traded at N1,491.67/$1.

According to data from the Central Bank of Nigeria (CBN), the naira appreciated by 0.3 percent or N4.03 in a single day, rising from N1,501.49/$1 on Friday, September 12, to N1,497.46/$1 at the start of the new week.

Year-to-date, the naira has gained N43.9 or 2.9 percent, appreciating from N1,541.36/$1 at the beginning of 2025. Analysts attribute this trend to reduced demand pressure, policy consistency from the apex bank, and a stronger inflow of foreign exchange earnings.

Market watchers say the CBN’s interventions, alongside improved investor confidence, are helping to narrow the gap between official and parallel market rates, thereby reducing speculative attacks on the currency.

With inflation gradually easing and crude oil prices relatively stable, the MPC maintains that sustaining liquidity inflows and curbing speculation will be key to preserving the naira’s recent momentum in the coming months.