Naira Records Strong Rebound in Parallel Market
The Nigerian naira demonstrated a robust recovery in the parallel market on Monday, February 16, 2026, appreciating to N1,390 per United States dollar. This movement represents a substantial 2.16 percent gain compared to the N1,420 rate quoted the previous Friday, February 13. Street traders confirmed that the local currency gained N30 within a single trading session, reflecting renewed market confidence and improved dollar liquidity in the informal foreign exchange segment.
Exchange Rate Spread Narrows Significantly
With the naira's latest appreciation, the spread between the parallel market and the official window has tightened considerably. The gap has now reduced to N35, down from N92 recorded just last Wednesday. This marks a 2.5 percent improvement in convergence between the two markets, which is widely viewed as a positive development for Nigeria's economy.
A wide disparity between official and black market rates often fuels speculation, arbitrage opportunities, and pricing distortions throughout the economy. The closer alignment helps improve transparency and reduces uncertainty for businesses and investors operating in Nigeria. Last week, the gap had already narrowed to N65 after the Central Bank of Nigeria reopened the retail foreign exchange window for Bureau De Change operators, allowing them access to fresh dollar supplies from commercial banks.
Central Bank Interventions Drive Market Stability
Recent interventions by the Central Bank of Nigeria have focused on improving dollar availability, restoring market confidence, and strengthening oversight of foreign exchange transactions. By reopening access for Bureau De Change operators and facilitating supply through authorized dealer banks, monetary authorities aim to reduce pressure on the parallel market and discourage hoarding practices.
Currency stability remains crucial for Nigeria's inflation outlook, import costs, and overall economic planning. A stronger and more predictable naira could ease the burden on businesses reliant on imported raw materials and reduce price volatility for consumers. Market watchers emphasize that sustained convergence between the official and parallel markets would signal deeper structural stability in Nigeria's foreign exchange framework.
Mixed Performance at Official Market
While the parallel market recorded a sharp gain, the official window showed a marginal depreciation during the same period. Data from the Central Bank of Nigeria indicated that the naira slipped by N1.76 at the Nigerian Foreign Exchange Market on Friday, February 13. The dollar was quoted at N1,355.42, representing a 0.13 percent loss compared to N1,353.66 recorded the previous day.
Despite this modest setback, financial analysts note that the broader trend still reflects gradual convergence between both markets, especially as regulatory measures continue to boost supply and curb speculative demand. The Central Bank's policy shift granting licensed bureaux de change renewed access to the official market represents a significant development, with each licensed BDC permitted to purchase up to $150,000 per week at prevailing market rates through authorized dealer banks.
Market Participants Report Improved Conditions
Black market traders confirmed to journalists that the naira's rally was primarily due to sales of dollars by the Central Bank of Nigeria to traders. Abbas Yishau, a street trader operating in the Ogba axis of Lagos, reported that there is currently sufficient United States dollar availability in the black market, which has contributed to the massive rally in the parallel market segment.
Financial experts had previously raised concerns as the parallel market drifted further apart from the official window, leading to Central Bank interventions aimed at mopping up dollars to create artificial scarcity and stabilize the currency. For now, the naira's latest rally offers cautious optimism, with traders and businesses hopeful that continued policy support will maintain the momentum in the coming days and weeks.
