Nigeria’s currency continued to regain ground in the official foreign exchange market this week, marking four straight days of trading below the N1,450/$1 threshold—a level it struggled to break in the previous week’s volatile sessions. The steadier performance reflects a mild but observable shift in sentiment, aided in part by the Central Bank of Nigeria’s (CBN) decision to maintain a tight monetary stance.

Throughout the week, CBN’s daily data showed the Naira appreciating in small increments. It began the week at N1,452/$1 on Monday and strengthened to N1,441/$1 by Tuesday. The midweek session preserved the momentum at N1,442/$1, while Thursday saw a slight adjustment to N1,445.9/$1. By Friday, the currency closed at N1,446.9/$1—rounding out a consistent, if gradual, five-day improvement.

These movements contrast with the previous trading week, which ranked among the Naira’s most challenging in recent months. Then, the currency stayed above N1,450/$1 every day, weighed down by persistent market pressures. It had opened last Monday at N1,447/$1 before slipping to N1,458/$1 on Tuesday, improving only briefly midweek, and ultimately closing at N1,458/$1. This week’s finish at N1,446.9/$1 represents a noticeable firming relative to last week’s outcome.

The foreign exchange developments unfolded alongside the Monetary Policy Committee’s 303rd meeting, where members voted unanimously to retain all key policy parameters. The Monetary Policy Rate remained at 27%—a historically high level aimed at curbing inflation and shoring up investor confidence. The Cash Reserve Ratio stayed at 45% for deposit money banks and 16% for merchant banks, while the Liquidity Ratio held steady at 30%. The asymmetric corridor was left at +50/-450 basis points around the MPR to reinforce short-term rate management.

According to the MPC, holding the policy framework steady will help consolidate the disinflation recorded in October, when headline inflation eased to 16.05% from September’s 18.02%. Food inflation eased to 13.12%, and core inflation moderated to 18.69%. The committee attributed the declines to tight monetary conditions, improved FX stability, better food supply, and a surplus in the current account.

CBN Governor Olayemi Cardoso emphasized that maintaining a restrictive policy environment remains central to sustaining recent gains in the foreign exchange market. He noted that the bank aims to encourage capital inflows, enhance market transparency, and reinforce broader economic reforms, describing the week’s performance as evidence that “the policy mix is beginning to yield the desired stabilizing effects.”