The naira has strengthened against the British pound, pushing sterling below the ₦1,800 mark as improved foreign exchange liquidity and stronger autonomous inflows continue to support the Nigerian currency. The pound traded around ₦1,786, a significant improvement for the naira compared with periods when sterling exchanged above ₦2,000.
Naira Gains as FX Market Improves
The move below ₦1,800 represents an important psychological level in the market and could offer some relief to Nigerians paying for UK-linked expenses, including tuition, travel, imports and other sterling-denominated transactions. The naira's latest performance comes amid continued changes in Nigeria's foreign exchange market, where the Central Bank of Nigeria (CBN) has increasingly focused on improving liquidity, strengthening price discovery and reducing distortions.
The settlement of outstanding legacy foreign exchange obligations has also helped shift market attention towards more sustainable sources of dollar supply. Diaspora remittances, crude oil export earnings and other autonomous foreign currency inflows have become increasingly important to the naira's performance. Sustaining the gains, however, will depend largely on whether foreign exchange supply continues to meet demand from businesses, importers and individuals.
British Pound Weakens Against Dollar
The pound's decline against the naira has also been reinforced by weakness in sterling on international markets. Sterling surrendered some of its recent gains against the US dollar, trading near a five-week low of about $1.3465 during the London session. The decline followed weaker-than-expected signals from the UK labour market.
Britain's ILO unemployment rate remained at 4.9% in the three months to July, compared with expectations of an increase to 5%. However, unemployment benefit claims jumped by 27,800, considerably above the expected 8,300 increase and reversing an 11,800 decline recorded previously. The figures added to concerns about the strength of the UK economy and increased attention on the Bank of England's next interest rate decision.
Traders Watch Bank of England, US Fed
Currency traders are closely monitoring the Bank of England's policy meeting for indications about the future direction of UK interest rates. Inflation figures are also expected to play an important role in shaping expectations for monetary policy. Meanwhile, the US dollar has received support from expectations surrounding the Federal Reserve's policy direction, adding pressure on sterling.
For Nigerian currency users, the combination of a stronger naira and a weaker pound internationally has driven sterling below the ₦1,800 threshold. Further movements will depend on developments in Nigeria's FX market as well as monetary policy decisions in Britain and the United States.
Meanwhile, CBN data shows that the naira steadied against the US dollar on Friday, September 19, 2026, trading at N1,331. Legit.ng earlier reported that the naira weakened against the US dollar at the official foreign exchange market as renewed demand for international payments put pressure on the local currency despite a sharp rise in market liquidity. Data from the Nigerian Foreign Exchange Market (NFEM) showed that the naira closed at N1,329.15 per dollar, compared with N1,326.30/$ in the previous trading session.
