By BizWatch Nigeria Finance Desk | June 2, 2026, 10:00 AM
Key Points
- The naira appreciated to ₦1,366.80 per dollar at the official market
- Nigeria’s external reserves climbed to $49.58 billion at the end of May
- Strong oil receipts and CBN interventions continue to support the currency
Main Story
The naira strengthened against major foreign currencies on Monday as growing proceeds from Nigeria’s hydrocarbon exports boosted external reserves and improved foreign exchange liquidity.
Data released by the Central Bank of Nigeria (CBN) showed that the official exchange rate closed at ₦1,366.80 per U.S. dollar, improving from ₦1,373.24 recorded at the previous session.
The local currency traded within a relatively narrow range of ₦1,360 to ₦1,374.50 during the session, indicating reduced pressure on foreign exchange demand.
The British pound closed at ₦1,832.61, while the euro settled at ₦1,586.54. The Japanese yen ended the session at ₦8.55, according to official CBN data.
In the parallel market, the naira also gained ground, strengthening to ₦1,375 per dollar as confidence improved across both official and informal market segments.
The currency’s performance coincides with a rise in Nigeria’s gross external reserves, which reached $49.58 billion at the end of May. Analysts attribute the improvement largely to stronger crude oil export earnings and sustained foreign exchange inflows.
Global oil prices also surged after geopolitical tensions in the Middle East intensified following Iran’s decision to suspend negotiations with the United States. Brent crude approached $95 per barrel while West Texas Intermediate climbed above $91 per barrel, raising expectations of stronger oil revenues for major exporters such as Nigeria.
The Issues
Nigeria’s foreign exchange market has faced prolonged volatility in recent years due to limited dollar supply, capital outflows and fluctuating oil production. The recent improvement in reserves and exchange rate stability suggests ongoing reforms by the CBN may be beginning to yield results, although sustained oil revenues remain critical to maintaining momentum.
What’s Being Said
“Growing external reserves provide a stronger buffer for the Central Bank to support exchange-rate stability,” analysts at Broad Street investment firms said.
Independent economists have also noted that higher global oil prices could improve Nigeria’s foreign exchange earnings if production levels remain stable.
What’s Next
- Investors will monitor further movements in global oil prices amid Middle East tensions.
- The CBN is expected to continue targeted interventions to maintain market stability.
- Reserve levels and oil export receipts will remain key indicators for the naira’s outlook.
The Bottom Line:
The naira’s latest gains underscore the importance of strong reserve buffers and higher oil revenues in supporting currency stability. Sustaining these gains will depend on continued foreign exchange inflows and Nigeria’s ability to maintain crude oil production and exports.
