After months of market turbulence and tightening wallets, the naira appears to be regaining lost ground. The Nigerian currency strengthened to ₦1,518 to the United States dollar on Monday July 14 2025, at the official market, its strongest performance since March 14, 2025, according to the Central Bank of Nigeria (CBN) data. This comes after weeks of modest recovery, signalling cautious optimism in the financial markets.

CBN’s recent moves, including the sale of $50 million and a high-yield OMO auction, seem to be finally paying off. Analysts say FX liquidity has improved, investor confidence is rebounding, and intervention are stabilising demand pressures. Which means more dollars in the system and less panic among traders and businesses.

“CBN’s actions have helped ease demand pressures and boost market confidence,” said a note from Anchoria Limited, which forecasts the naira will remain in a “stable band between ₦1,515 and ₦1,535” this week, barring any major shocks.

For now, the official markets are celebrating but the streets are less optimistic. At the parallel market, the economy for Nigerians is that the naira closed at ₦1,540/$, still off from the official rate. This highlight gap between official reforms and on-the-ground realities, where importers, SMEs, and other retail users still face challenges accessing FX.

A recent report from Cowry Assets warned that while reforms are working, the underlying issues like high dollar demand, low export volumes, and investors’ scepticism have not disappeared and which makes it seem like the CBN is managing the storm, but have not changed the weather

Regardless of the fact that not everyone is convinced that the current rebound is sustainable, there is still signs of hope. Oil prices have remained steady, diaspora remittances are picking up, and Nigeria’s mid-year macro outlook from CardinalStone suggests the naira is finally trading close to its fair value.

Also Read: How the Naira looked on Tuesday when matched against the dollar

According to CardinalStone, FX intervention this year have averaged $786 million monthly, significantly lower than pre-COVID highs.

The recent strengthening might finally be a sigh of relief. One of the first places this could show up is at the market. With a stronger naira, Nigerians are expecting food inflation to slow down, making it less painful to shop for essentials.

It also has a ripple effect on imported goods. From electronics and certain household items, better exchange rates means lower import costs that might translate to more affordable prices on the shelves.

A stronger naira might bring some hope for students and families with financial obligations abroad. It could ease the pressure of school fees and travelling expenses.

The prices of fuel and commodities may not fall drastically, but one hopes that some relief is possible. FX pressure is easing so the cost of bringing in petroleum products and essential commodities could begin to also ease.

However, the biggest impact of an increasingly appreciating naira is the recent announcement by banks that customers can now use their naira cards to make online purchases often denominated in dollars. Hitherto, customers purchased dollars from the black market and deposited in their domiciliary account, before making such purchases. Moving this this retail need into official channels could significantly lessen the pressure in the largely opaque black market.

Anita Chinedu