Naira Records Appreciation Across Forex Markets Following CBN Directive
The Nigerian naira has shown notable appreciation against major global currencies across both official and parallel foreign exchange market segments. This positive movement comes in direct response to a new directive issued by the Central Bank of Nigeria targeting diaspora remittance inflows, which aims to enhance transparency and deepen liquidity in the formal foreign exchange market.
Official Market Performance Shows Improvement
According to data released by the Central Bank of Nigeria, the local currency strengthened by N2.82, representing a 0.2% gain, to close at N1,383.88 per United States dollar at the Nigerian Foreign Exchange Market on Thursday, March 26. This marked an improvement from the previous day's rate of N1,386.70 per dollar.
The naira also demonstrated strength against other major currencies, gaining N8.62 against the British pound sterling to trade at N1,847.76 per pound, compared with N1,856.38 per pound recorded the previous day. Similarly, the currency appreciated by N8.66 against the euro, closing at N1,597.14 per euro versus N1,605.80 per euro in the preceding session.
Mixed Results Across Different Market Segments
While the official market showed consistent gains, performance varied across different trading platforms. At the GTBank foreign exchange desk, the naira experienced a decline, losing N10 against the dollar to trade at N1,401 per dollar compared with N1,391 per dollar in the previous trading session.
In the parallel market, currency traders reported ongoing activity with the dollar being bought at N1,403 and sold at N1,420. The British pound traded between N1,860 and N1,895, while the euro ranged from N1,595 to N1,625, according to Abudulahi, a Bureau de Change operator who spoke about current market conditions.
CBN's New Framework for Diaspora Remittances
The Central Bank of Nigeria issued a directive earlier in the week requiring all International Money Transfer Operators to route transactions through designated naira settlement accounts held with authorized dealer banks. This policy, outlined in a circular titled "Measures to Further Enhance Compliance in the Remittance Space," was signed by Musa Nakorji, Director of the Trade and Exchange Department.
The new framework mandates that all International Money Transfer Operator inflows be channeled through authorized dealer banks for conversion into naira, thereby strengthening the role of the formal banking system and improving the traceability of foreign exchange transactions. This move is designed to increase transparency and boost liquidity in the official foreign exchange market.
Current Exchange Rates Across Major Currencies
The latest exchange rates published show the naira trading at various levels against global currencies:
- CFA: N2.450
- Chinese Yuan/Renminbi: N200.273
- Danish Krona: N213.727
- Euro: N1,597.139
- Japanese Yen: N8.672
- Saudi Riyal: N368.858
- South African Rand: N81.303
- Swiss Franc: N1,744.024
- British Pounds Sterling: N1,847.761
- US Dollar: N1,383.883
- UAE Dirham: N376.731
Concerns Over Declining Foreign Reserves
Despite the naira's recent gains, concerns persist regarding Nigeria's foreign reserves, which have experienced a sustained decline. Central Bank data reveals that external reserves dropped to $49.57 billion as of March 24, 2026, down from a recent peak of $50.02 billion recorded on March 11, 2026.
The reserves have declined for seven consecutive trading sessions, highlighting the ongoing impact of capital outflows and structural challenges facing the country's foreign exchange earnings. This sustained decrease raises questions about whether the naira's current momentum can be maintained in the face of diminishing reserve buffers.
The Central Bank's new directive on diaspora remittances represents a strategic effort to bolster foreign exchange inflows through formal channels, but its long-term effectiveness in stabilizing the naira will depend on multiple factors including continued policy implementation and broader economic conditions.
