Naira Holds Steady Against Euro Amid Geopolitical Tensions
The Nigerian naira has maintained its gains against the euro, settling at N1,557/€1 as of Friday. This represents a slight improvement from the previous session's rate of N1570/€1. The EUR/NGN exchange rate peaked near N1,774/€1 in January 2026 before dropping to around N1,555/€1.
The CBN's high interest rates have been supportive of portfolio flows into Nigeria and a relatively controlled depreciation of the local currency. However, European Central Bank (ECB) rate cuts have provided some support for the euro relative to emerging market currencies.
Geopolitical tension and risk are intensifying due to military airstrikes on Iran and rising trade tensions between the US and its biggest trading partners. The US intends to impose new tariffs of 10% to 12.5% on imports from these countries, including a 12.5% tariff on Nigerian imports over forced labour concerns.
The CME FedWatch tool data showed a 35.8% probability of a Fed rate hike in July and an 82.1% likelihood of at least a quarter-point increase to the federal funds rate target in September.