Naira Extends Rally, Trades Below N1,450/$1 as CBN Holds Policy Rate

The Nigerian Naira sustained its recovery this week, trading below ₦1,450 per U.S. dollar, following the Central Bank of Nigeria’s (CBN) decision to maintain its current monetary policy stance.

The bank opted to retain the Monetary Policy Rate (MPR) at 27 percent, signaling a continued commitment to stabilize the foreign-exchange market and support macroeconomic stability.

Market activity showed the naira closing at ₦1,441/$1, improving from earlier rates above ₦1,450/$1.

The Central Bank’s decision to hold all major policy parameters steady, including the asymmetric corridor for the standing facility and the Cash Reserve Ratio (CRR), reflects an effort to anchor inflation expectations, encourage foreign inflows, and sustain the gains already made in the currency market.

Financial analysts have highlighted that this policy continuity has bolstered investor confidence in naira-denominated assets, contributing to the currency’s resilience. Over the past months, the naira has exhibited gradual improvement, reflecting stronger inflows and a relatively stable foreign-exchange environment.

However, experts caution that while the recovery is encouraging, it remains susceptible to external pressures, such as fluctuations in oil prices and global economic uncertainties.

Any sharp increase in dollar demand or slowdown in foreign inflows could challenge the currency’s current stability.

For businesses and individuals reliant on foreign exchange, the trading of the naira below ₦1,450/$1 provides temporary relief and an improved outlook. Yet, sustaining this trend will depend on continued disciplined fiscal management, consistent supply of foreign exchange, and measures to keep inflation under control.

The CBN’s retention of the MPR and other monetary measures underscores its cautious approach, balancing the need for economic growth with the imperative of currency stability. As the year progresses, market participants will closely monitor the central bank’s actions and their effects on the naira’s trajectory.