Naira Shows Resilience with Dollar Appreciation in Official Forex Trading
The Nigerian naira demonstrated a notable recovery against the United States dollar in the official foreign exchange market on Tuesday, January 20, 2026, marking a positive shift in currency valuation trends. According to detailed market reports, the local currency appreciated by 93 kobo, representing a 0.06% gain, to close at N1,419.35 per US dollar. This improvement came from the previous day's rate of N1,420.28 per dollar, indicating subtle but meaningful strengthening in the Nigerian Autonomous Foreign Exchange Market (NAFEM).
Mixed Currency Performance Across Different Market Segments
While the naira gained ground against the US dollar in the official market, it experienced depreciation against other major global currencies during the same trading session. Specifically, the currency weakened against the British pound sterling by N2.43, trading at N1,908.31 per pound compared to N1,905.88 per pound in the preceding session. Similarly, the naira lost significant value against the euro, declining by N13.53 to close at N1,666.31 per euro versus N1,652.78 per euro recorded previously.
At the GTBank foreign exchange counter, a different pattern emerged as the naira declined against the US dollar by N5, selling at N1,429 per dollar down from Monday's exchange rate of N1,424 per dollar. However, in the parallel market, commonly referred to as the black market, the naira remained stable with no changes reported in its valuation against major currencies.
Market Analysis and Trader Insights on Currency Movements
Abdullahi, a Bureau de Change operator, provided specific trading rates observed in the market, noting that the dollar buying rate stood at N1,484.99 with a slightly higher selling rate. He further detailed that the euro was selling at N1,753.50 with a corresponding buying rate, while the British pound sterling traded at N2,034.99 for selling with an appropriate buying rate. The Canadian dollar was reported trading at N1,091.00 during the same period.
Financial analysts monitoring the currency markets have expressed expectations that the naira will maintain its current trading range in the near term. This stability is anticipated to be supported by several key factors including stronger foreign currency inflows driven by higher oil revenues, improved foreign portfolio investment participation, and consistent foreign exchange management policies implemented by the Central Bank of Nigeria (CBN).
Additional Factors Influencing Currency Market Dynamics
Market observers have highlighted that increased inflows from exporters and importers, alongside supply from non-bank corporate entities, would contribute to improved market liquidity. Furthermore, international currency dynamics played a role as the US dollar faced pressure in global markets amid growing tensions between the United States and its European allies over Greenland. Reports indicated that President Donald Trump's firm stance triggered selloffs, with investors shifting to other safe-haven assets.
Comprehensive Exchange Rate Data Across Multiple Currencies
The trading session recorded various exchange rates for different international currencies against the naira:
- CFA Franc: N2.50
- Chinese Yuan (Renminbi): N203.89
- Danish Krone: N222.95
- Euro: N1,665.72
- Japanese Yen: N8.99
- Saudi Riyal: N378.35
- South African Rand: N86.18
- Swiss Franc: N1,796.46
- British Pound Sterling: N1,907.64
- US Dollar: N1,418.85
Economic Projections and Future Outlook for the Naira
Earlier economic forecasts provided context for the naira's performance, with Yemi Kale, Chief Economist at the Africa Export-Import Bank (Afreximbank), projecting during his keynote address at the FirstBank Nigeria Economic Outlook 2026 that the currency would trade between N1,350 and N1,450 per US dollar throughout 2026. In a baseline scenario, Kale anticipates the naira will remain under pressure but is unlikely to collapse sharply, with estimated rates of around N1,313 per dollar by June and approximately N1,340 by December 2026.
The mixed performance of the naira across different market segments highlights the complex dynamics of Nigeria's foreign exchange environment, where official market gains can contrast with bank counter movements and stability in parallel markets. Market participants continue to monitor CBN policies, oil revenue trends, and global economic developments that influence currency valuation patterns.
