Naira slides further to N1,466 as FX pressure persists
The naira finished the trading week on a lower note at N1,466.5 per dollar on Friday in the official foreign exchange market, continuing the steady decline observed throughout the week.
Data released on the Central Bank of Nigeria’s website indicated that the local currency weakened over five consecutive trading days, highlighting renewed pressure within the foreign exchange market.
Friday’s closing rate represented a level last recorded on October 21, 2025, when the naira was valued at N1,464.5 to the dollar, signifying a return to volatility following a phase of relative stability.
Available trading records showed a gradual but consistent depreciation of the naira throughout the week.
On Monday, the currency closed at N1,454 to the dollar.
On Tuesday, the naira fell further to N1,457 to the dollar.
On Wednesday, it slipped slightly to N1,458.02 against the dollar.
By Thursday, the exchange rate had decreased to N1,462.9 to the dollar.
The naira ultimately closed on Friday at N1,466.5 per dollar.
In terms of weekly performance, the currency also experienced a decline compared to the previous trading cycle.
Last week, the naira ended at N1,455.50 to the dollar, indicating a drop from Thursday’s closing rate of N1,455.25 to the dollar.
The ongoing decline signals persistent demand for foreign currency, despite the Central Bank of Nigeria’s reforms and market interventions.
The naira's depreciation coincided with a significant fiscal event, as President Bola Tinubu presented the 2026 Appropriation Bill to the National Assembly on Friday.
The President characterized the assumptions behind the 2026 budget as conservative.
Key budget projections include an oil price benchmark set at 64.85 dollars per barrel.
The budget also anticipates crude oil production of 1.84 million barrels per day.
An exchange rate of N1,400 to the dollar was included in the budget framework.
President Tinubu emphasized the importance of maintaining strict budget discipline, pointing out that key economic officials have been instructed to closely follow approved spending details and timelines.
The exchange rate assumption within the 2026 budget is notably higher than the current official market rate.
This difference highlights a disconnect between fiscal forecasts and the realities of the foreign exchange market.
Analysts link the gap to concerns about the sustainability of foreign exchange supply and potential risks to crude oil output.
President Tinubu presented the 2026 budget without disclosing a performance report for the 2025 fiscal year, raising issues of transparency and accountability.
These concerns are further exacerbated by analysts' observations of Nigeria’s inconsistent practice of managing multiple budgets at once.
Market observers indicate that the gap between the assumed exchange rate in the budget and the current market rate could affect investor perception in the upcoming weeks.
They caution that if crude oil production targets or external financial inflows are not met, the pressure on the naira may continue.
However, analysts also point out that enhancements in foreign exchange liquidity, improved oil revenues, or increased portfolio investments could help stabilize the currency.
The naira’s latest closing rate reinforces worries about short-term volatility as the market evaluates fiscal implications from the 2026 budget against broader macroeconomic conditions and ongoing foreign exchange market dynamics.
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