The Nigerian naira experienced a decline in the official foreign exchange market on Monday, January 19, 2026, as heightened demand and constrained dollar supply exerted pressure on the currency. This development occurred in the absence of significant intervention from the Central Bank of Nigeria, contributing to the naira's depreciation against major global currencies.
Official Market Performance and Data
According to data released by the Nigerian Foreign Exchange Market, the naira fell by N2.33, representing a 0.16 percent decrease, to close at N1,420.28 per US dollar. This marked a decline from the previous session's rate of N1,417.95 per dollar. The currency also showed weakness against other major currencies, losing N4.56 against the British pound to settle at N1,905.80 per pound and declining by N5.27 against the euro to close at N1,652.78.
GTBank's Foreign Exchange Desk Adjustment
In contrast to the broader market trend, Guaranty Trust Bank reported a slight appreciation of the naira at its foreign exchange desk. The bank quoted a new exchange rate of N1,424 per dollar, representing an improvement of N3 from the previous Friday's rate of N1,427 per dollar. This adjustment specifically applies to international payments processed through the bank's services.
Parallel Market Stability
Meanwhile, in the parallel market, commonly referred to as the black market, the naira exchange rate remained unchanged. According to Abudullai, a Bureau de Change operator, the dollar was being sold at N1,485 per dollar, maintaining the same rate as previous trading sessions.
Market Analysis and Economic Context
Financial analysts have attributed the naira's weakness in the official window to demand significantly outpacing available supply. The Central Bank of Nigeria maintained a relatively passive stance during the trading session, which contributed to the currency's downward pressure.
However, market expectations remain optimistic regarding potential improvements in dollar liquidity. Analysts anticipate enhanced dollar inflows from multiple sources, including the Central Bank of Nigeria, export activities, and corporate transactions, which could provide support for market stability.
Broader Economic Indicators
Despite the currency fluctuations, Nigeria has recorded positive macroeconomic projections for 2026. Economic forecasts point toward stronger economic growth and reduced inflation rates, driven by ongoing governmental reforms and policy adjustments.
The Chartered Institute of Bankers of Nigeria has projected a single-digit interest rate for the year alongside a generally positive economic outlook. Additionally, Nigeria's external reserves showed a modest increase of $40.71 million from the previous day, reaching $45.90 billion. This reserve growth provides some support for the country's foreign exchange position and helps buffer against external economic shocks.
Foreign reserves serve as a crucial mechanism for the Central Bank of Nigeria to influence currency stability in international markets. These reserves enable the bank to intervene in foreign exchange markets, manage supply and demand dynamics for the naira, and ensure the country can meet its international financial obligations.
