Naira Posts Strongest Annual Gain in Nearly a Decade Amid Rising Oil Prices

The Nigerian Naira has continued its upward trend against major currencies in the official foreign exchange market. On Wednesday, September 2, it sold for N1,326.69 per US Dollar, a gain of N2.74 or 0.21% from the previous rate of N1,329.43/$1. This appreciation also extended to the Pound Sterling and Euro, with the Naira trading at N1,791.16/£1 and N1,538.43/€1 respectively.

Analysts attribute the strengthening Naira to rising Dollar inflows from higher oil prices and remittances, which are helping to shield the currency from election-related risks. Bloomberg projects that the Naira will strengthen to N1,290 per Dollar by year-end, extending its 8% gain so far this year to nearly 12%, marking its strongest annual appreciation since at least 2018.

The external reserves have also reached an 18-year high of $53.9 billion, providing the Central Bank of Nigeria (CBN) with greater buffers to support the Naira against future economic uncertainties and potential election-related shocks.