• Naija’s currency strengthens, closing at ₦1,342.30 per dollar amid improving FX market conditions
• External reserves dip slightly to $48.70 billion, reflecting global uncertainties impacting Nigeria’s economy
• Oil prices surge as tensions rise in the Middle East, boosting Nigeria’s FX position

Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.

The Nigerian currency continued its upward trend at the Nigerian Foreign Exchange Market (NFEM), closing stronger at ₦1,342.30 per dollar.

The gain represents a modest appreciation of ₦1.44, reflecting improving conditions in the foreign exchange market.

The local unit traded within a relatively tight band of ₦1,340/$ to ₦1,344/$ during the session, signalling increased stability compared to previous days. The positive movement comes as FX supply begins to outpace demand, easing pressure on the naira.

Improved FX inflows drive market confidence

Market sentiment has been buoyed by stronger inflows from foreign portfolio investors, exporters, and non-bank corporates. These sources have helped boost liquidity, giving dealers more room to meet demand and moderate exchange rate volatility.

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Commercial banks, including major players like Guaranty Trust Bank and Zenith Bank, were seen offering dollars at relatively competitive rates, further supporting the naira’s appreciation trend, a Vanguard report revealed.

Despite the improved supply conditions, trading activity slowed. Interbank turnover dropped to $72.26 million across 82 deals, down from $114.35 million recorded in the previous session.

Analysts suggest that while liquidity has improved, cautious trading persists among market participants.

External reserves dip slightly

Nigeria’s external reserves stood at $48.70 billion, a slight decline from previous levels and still below the $50 billion mark last seen in 2009. The dip reflects ongoing global uncertainties, particularly in the commodities market, which continues to influence the country’s FX earnings.

Oil prices rise amid global tensions

Crude oil prices climbed sharply on Thursday, driven by doubts surrounding upcoming peace talks between the United States and Iran.

Investors remain uncertain whether negotiations will ease supply disruptions linked to tensions in the Middle East.

Brent crude rose by 3.39% to about $98.15 per barrel, while U.S. West Texas Intermediate (WTI) surged 5.89% to trade near $93.32 per barrel. Rising oil prices typically support Nigeria’s FX position, given its reliance on crude exports.

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Gold prices hold steady

In contrast, gold prices showed limited movement after hitting a one-month high in the previous session.

Spot gold dipped slightly by 0.66% to around $4,791.81 per ounce, while U.S. gold futures eased by 0.24% to $4,812.26 per ounce, according to a report by MarketForces Africa.

The mixed performance across global commodities underscores the delicate balance shaping Nigeria’s FX outlook, even as short-term gains provide relief for the naira.

Nigeria’s reserves hit an 8-year high

Legit.ng earlier reported that Nigeria’s foreign exchange reserves have climbed to their highest level in eight years, offering renewed optimism for the naira and strengthening the country’s external buffers amid ongoing economic reforms.

Data from the Central Bank of Nigeria (CBN) shows that gross external reserves rose to $46.012 billion as of January 22, 2026, marking an increase of about $510 million since the start of the year.

This level was last recorded in August 2018, underscoring a notable turnaround in Nigeria’s external position.

Source: Legit.ng