The naira strengthened to N1,484.13 per dollar at the official market, gaining N13 from Monday.
Analysts link the rise to easing FX demand and falling inflation, boosting cautious optimism.
The Nigerian naira continued to strengthen against the U.S. dollar on Tuesday, rising to N1,484.13 per $1 in the official foreign exchange market. This reflects a gain of N13 compared to Monday’s rate of N1,497.5/$.
At the parallel (black) market, however, the naira traded weaker, hovering between N1,520/$ and N1,530/$ during mid-week transactions in Lagos, Nigeria’s commercial hub.
Analysts noted that a decline in FX demand, partly due to Nigerian banks tightening debit card transactions involving foreign currencies, has provided support for the naira.
This has allowed the currency to stay below the N1,500/$ resistance line, signaling relative stability after last year’s sharp depreciation.
The rally comes as Nigeria records improved macroeconomic indicators. According to the National Bureau of Statistics (NBS), the country’s headline inflation dropped for the fifth consecutive month, easing to 20.12% in August from 21.88% in July 2025.
The Consumer Price Index (CPI) rose slightly to 126.8 points in August from 125.9 in July, while monthly inflation slowed to 0.74%, down significantly from 1.99% the previous month.
Food inflation, though still elevated, also moderated, falling from 37.52% in August 2024 to 21.87% year-on-year, while the month-on-month food index dropped to 1.65% in August from 3.12% in July.
With inflation moderating and FX demand easing, analysts say naira bulls could gain further momentum in the medium term, though global market sentiment will hinge on the U.S. Federal Reserve’s interest rate decision expected later today.
