Naira strengthens to N1,320 as reserves hit 18-year high

By Boluwatife Oshadiya | September 8, 2026

Key Points

• The naira strengthened to ₦1,320.5574 per US dollar at the Nigerian Foreign Exchange Market
• Gross foreign-exchange reserves reached US$54.08 billion on September 3, their highest level since December 2008
• NFEM turnover fell 33% week-on-week to about US$2.14 billion, raising questions about the strength of the recent currency appreciation

Main Story

The naira strengthened to ₦1,320.5574 per US dollar at the Nigerian Foreign Exchange Market (NFEM), extending recent gains as Nigeria’s foreign-exchange reserves climbed above US$54 billion.

The currency improved from ₦1,321.2160 previously, while the official-market rate traded between ₦1,318.5000 and ₦1,322.5000 per dollar, according to the foreign-exchange data provided by the Central Bank of Nigeria (CBN).

The naira appreciated by 0.97% during the five trading days through September 4, closing the week at ₦1,322.50/$1 compared with ₦1,335.50/$1 at the start of the week.

However, the appreciation came alongside weaker market activity. NFEM turnover through September 3 fell to approximately US$2.14 billion from US$3.19 billion in the preceding week, representing a 33% week-on-week decline.

Coronation Merchant Bank’s research subsidiary said the recent naira strength had occurred alongside lower trading activity rather than a broad-based increase in market turnover.

Meanwhile, gross foreign-exchange reserves rose to US$54.08 billion on September 3, marking the first time since December 2008 that reserves have exceeded US$54 billion. The reserves have increased by about US$8.6 billion since the beginning of the year, strengthening Nigeria’s external liquidity buffer.

The parallel-market rate remained around ₦1,400/$1, leaving a sizeable gap with the official rate. The premium stood at about ₦68.78/$1 based on the rates provided.

What’s Being Said

“Looking ahead, we expect the Naira to remain broadly stable in the near term, supported by an improvement in external reserves and relatively contained exchange-rate pressures,” Coronation Merchant Bank’s research subsidiary said.

Coronation analysts nevertheless said the decline in FX turnover means the recent appreciation should be monitored for confirmation through stronger underlying market activity.

What’s Next

• Coronation expects the NFEM rate to remain broadly within the ₦1,300–₦1,350/$1 range, barring major external shocks
• Investors will monitor whether higher reserves translate into sustained FX liquidity and stronger official-market turnover
• The impact of Nigeria’s Frontier Market reclassification on foreign investor participation will become clearer after FTSE Russell’s September 21 effective date

The Bottom Line:

The naira’s recent gains are being supported by a much stronger external reserve position, but declining FX turnover means the appreciation has yet to demonstrate broad-based market depth. The durability of the recovery will depend on whether stronger reserves are matched by sustained liquidity and trading activity.