Naira Gains Against USD: Global Investors Return as Confidence Floods Nigerian Market
- The Nigerian currency has rebounded against the US dollar after three days of sustained losses, driven by investor confidence
- On Wednesday, October 8, 2025, the naira gained about 0.03% to close at N1,470.62 relative to N1,475 recorded earlier in the week
- Also, the local currency appreciated in the parallel segment of the foreign exchange market
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Pascal Oparada, a reporter for Legit.ng, has over ten years of experience covering technology, energy, stocks, investment, and the economy.
After three days of sustained depreciation, the naira bounced back against the US dollar on Wednesday, buoyed by renewed foreign investor confidence and an improved supply of foreign exchange.
At the Nigerian Foreign Exchange Market (NFEM), the local currency gained 0.03% to close at ₦1,470.62 per dollar, compared to ₦1,475 recorded earlier in the week.
Source: Getty Images
The naira also appreciated at the parallel market, rising 0.12% to close at ₦1,492, narrowing the gap between official and street rates to about ₦20.
The rebound marks the end of a brief losing streak and signals renewed optimism in the Nigerian investment climate.
Investor confidence rises after global endorsement
Market confidence surged after FTSE Russell, a leading global index provider, confirmed that foreign investors can now repatriate US dollars freely from the Nigerian capital market, a major shift from the liquidity bottlenecks that plagued the market last year.
In its latest market classification review, FTSE Russell said that participants reported no significant delays in FX repatriation, adding that Nigeria’s foreign exchange queues had been cleared.
This development prompted discussions around upgrading Nigeria’s index status from unclassified back to frontier market, a status it lost in September 2023 when FX restrictions undercut investor access.
The confirmation followed months of foreign exchange reforms implemented by the Central Bank of Nigeria (CBN), including the removal of repatriation limits and improved transparency at the official window.
Reforms and market fundamentals support naira
The turnaround comes as the CBN injected $150 million into the official FX window to ease demand pressures and stabilise the market.
Analysts say the intervention, alongside the improving macroeconomic sentiment, has supported the naira’s resilience below the ₦1,500 mark.
“Unlike during the former CBN leadership era, foreign investors are now free to exit, and the CBN has been funding those exits without delays,” analysts at TrustBanc Financial Group noted.
They recalled that between March 1 and 14, 2025, the apex bank sold about $733.9 million to offset heavy portfolio outflows, helping to prevent a deeper slide.
TrustBanc added that this time around, Nigeria’s market is benefiting from both domestic policy clarity and global weakness in the US dollar index (DXY), which has eased pressure on emerging-market currencies.
A New chapter for Nigeria’s FX market
The naira’s rebound follows months of structural reforms aimed at restoring credibility in the country’s foreign exchange regime.
Since early 2024, the CBN has prioritised transparency, clearing backlogs, and harmonising multiple exchange windows.
Experts say the combination of these reforms, improved investor confidence, and the easing of global monetary pressures could position the naira for a sustained recovery in the months ahead.
Source: Getty Images
Still, analysts warn that the gap between the official and parallel markets remains a vulnerability that policymakers must continue to address to maintain market stability.
For now, however, the mood in Nigeria’s FX market is changing — cautiously but positively. The message is clear: the naira is fighting back, and investors are finally listening.
Naira now among world’s most competitive currencies
Legit.ng earlier reported that Nigeria’s currency, the naira, is recording its strongest performance in over twenty years, emerging as one of the most competitive currencies globally amid a weakening U.S. dollar.
Experts say this milestone signals a turning point for Africa’s largest economy, one powered by reform, resilience, and growing investor confidence.
Yemi Kale, Group Chief Economist and Managing Director at Afreximbank, made this revelation at The Platform Nigeria event in Lagos, describing the naira’s current exchange rate as “arguably the most competitive in two decades.
Source: Legit.ng
