The Nigerian naira began the first full trading week of 2026 with mixed movements across the foreign exchange market, reflecting persistent demand for the United States dollar despite signs of mild recovery.
As of the morning of Monday, January 5, 2026, the local currency showed slight improvement compared with its year-end position, although pressure remains across key market segments.
Official Market Rate at ₦1,441.85/$
At the Nigerian Foreign Exchange Market (NFEM), the official trading window supervised by the Central Bank of Nigeria (CBN), the naira exchanged at an average rate of ₦1,441.85 per dollar.
Market data showed early volatility, with the currency touching a low of ₦1,437.10/$ before stabilising around current levels. Analysts noted that liquidity levels at the official window continue to play a crucial role in price discovery as authorities pursue exchange rate convergence.
Parallel Market Trades at Premium
In the parallel market, commonly referred to as the black market, the naira continued to trade weaker than the official rate.
Checks across major commercial centres, including Lagos, Abuja and Kano, showed the dollar exchanging between ₦1,455 and ₦1,465, depending on location and transaction volume.
The spread between the official and parallel markets has narrowed slightly in recent weeks, suggesting a gradual convergence supported by tighter monetary controls.
Demand Pressures Drive Exchange Rate Movements
Analysts attributed the current exchange rate dynamics to the resumption of full business activities after the festive break.
Manufacturers and importers returning to the market to restock inventories for the first quarter of 2026 have increased dollar demand, putting upward pressure on the greenback.
Investors are also closely monitoring Nigeria’s foreign reserve position and any potential CBN interventions aimed at boosting liquidity in the foreign exchange market.
Outlook Hinges on Liquidity, Policy Direction
Market watchers say the naira’s near-term performance will depend largely on foreign exchange inflows, reserve levels and the consistency of CBN policy implementation.
While the narrowing gap between official and parallel rates offers cautious optimism, sustained stability, analysts note, will require improved dollar supply and continued confidence in Nigeria’s foreign exchange reforms.
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