The Dangote Group has projected that the naira will trade at N1,330 per dollar in the fourth quarter of 2026, with a full-year average of N1,385/$, according to its Economic Research and Intelligence H1 2026 Economic Report. The forecast, obtained by Nairametrics, attributes the expected stability to rising foreign reserves, increased foreign investment inflows, and a reduced fuel import bill driven by expanding domestic refining capacity.
Naira Appreciation in H1 2026
The report notes that the naira appreciated by approximately 4% in the first half of 2026, trading around N1,380/$ in the official foreign exchange market before strengthening to about N1,330/$ in August. The group expects the currency to maintain its firmer level, with quarterly projections showing N1,405/$ in the second quarter, N1,340/$ in the third, and N1,330/$ in the fourth, culminating in a full-year average close to N1,385/$.
According to the report: "Staff project the naira to hold its firmer level, averaging N1,405/$ in the second quarter, about N1,340/$ in the third and N1,330/$ in the fourth, for a full-year average close to N1,385/$." This outlook reflects improvements in Nigeria's external position, attractive real interest rates that have drawn foreign portfolio investors, and a lower fuel import bill as domestic refining capacity expands.
Impact of Lower Fuel Imports on Forex Stability
The expansion of domestic refining is expected to ease pressure on Nigeria's demand for dollars by reducing the foreign exchange required to import petrol and other refined petroleum products. Lower fuel import requirements could improve the country's external balance and support the accumulation of foreign reserves, provided other foreign exchange inflows remain favourable. This development is part of broader efforts to stabilise the naira and restore investor confidence in the foreign exchange market.
Reserves and Regional Recognition
The forecast comes amid improvements in Nigeria's external reserves and foreign exchange market conditions. Legit.ng had previously reported that the country's net foreign reserves reached a record $46 billion, helping to strengthen investor confidence. Additionally, the World Bank identified the naira as one of Africa's more resilient currencies in the second quarter of 2026, noting that its maximum depreciation was limited to 2.6% during the period.
The Dangote Group's forecast suggests the naira could retain its recent strength through the end of 2026, although the actual exchange rate will depend on developments in foreign investment flows, reserve levels, oil earnings, and demand for foreign exchange. The outlook underscores the potential for sustained stability, but the currency's trajectory remains tied to these key economic factors.
