Naira to remain stable but ‘substantial appreciation unlikely’

The naira is expected to maintain its steady momentum as the Central Bank of Nigeria (CBN) continues to roll out measures to ensure stability, but a ‘substantial’ strengthening of the currency may be ‘unlikely’ given the global uncertainty.

According to a weekly report published on Friday by Cordros, a Lagos-based consultancy, the currency appreciated by 1.1 percent week/week to N1,585.00/USD, mostly supported by the CBN’s sale of $190.40 million to the market.

Data obtained from the CBN website showed that the naira ended the week on a strong note, appreciating to N1,579/$1 on Friday, May 23, 2025, from Thursday’s closing rate of N1,586/$1, which marked its first depreciation following the monetary policy hold decisions.

Except for Thursday, the naira recorded a consistent upward trend, quoted at N1,597/$1 on Monday, N1,588.5/$1 on Tuesday, and N1,583/$1 on Wednesday, indicating relative stability.

“The naira is likely to stay stable in the short term, as global pressure remains contained amid easing trade tensions,” the analyst said.

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”However, any substantial appreciation appears unlikely, with FX liquidity still constrained by subdued foreign portfolio inflows amid persistent global uncertainty.”

Meanwhile, gross FX reserves rose for the fourth consecutive week, growing by $166.63 million w/w to $38.54 billion as of 21st May as the CBN continues to ensure it has enough buffers to maintain stability at the exchange rate market.

The stability of the naira is however returning lost confidence after the currency shed more than 40 percent of its value last year, enduring steep devaluation that’s now made it more competitive.

CBN governor Olayemi Cardoso said at the press briefing after the 300th MPC meeting that the country now has a competitive currency that will help create opportunities for export growth.

Cardoso noted that the CBN will double down on reforms that’ll ensure that the currency continues to remain stable despite global tensions while maintaining price stability to anchor inflation expectations.

Wasiu Alli

Wasiu Alli is a business, economics cum data journalist with strong expertise covering macro trends, capital markets, government policies, corporate earnings and comparative economics analysis. Alli turns raw data into trends that not only tells compelling stories but nudges investors to make valued and informed decisions. He’s an alumnus of Lagos State University and trained at Lagos Business School. He formerly heads the Companies and Markets desk at BusinessDay where he writes and supervises the production of well researched articles on earnings updates, corporate sectoral comparisons, market intelligence as well as interviews with C-suite executives.