Naira Rallies to N1,390 in Parallel Market as Exchange Rate Gap Shrinks by 2.5 Per Cent
- The naira appreciated to N1,390 per dollar, showing a 2.16% gain in the parallel market
- The spread between official and parallel markets narrows to N35, enhancing economic transparency
- Central Bank interventions aim to stabilise currency and reduce volatility in Nigeria's foreign exchange market
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The naira recorded a strong rebound in the parallel market on Monday, February 16, 2026, appreciating to N1,390 per dollar and further closing the gap with the official foreign exchange window.
The latest movement represents a 2.16 per cent gain compared to the N1,420 quoted last Friday, February 13.
Source: Getty Images
Street traders confirmed that the local currency gained N30 within one trading session, reflecting renewed confidence and improved dollar liquidity in the informal market.
The rally comes amid broader efforts by monetary authorities to stabilise the foreign exchange system and reduce volatility across segments of the market.
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.
The narrowing spread is widely seen as a positive development for the economy, as a wide disparity between official and black market rates often fuels speculation, arbitrage, and pricing distortions.
A closer alignment helps improve transparency and reduces uncertainty for businesses and investors.
Last week, the gap had already narrowed to N65 after the Central Bank reopened the retail foreign exchange window for Bureau De Change operators, allowing them access to fresh dollar supplies from commercial banks. That move appears to have contributed to improved liquidity and reduced pressure in the parallel market.
Black market traders told Legit.ng that the naira's rally was due to sales of dollars by the Central Bank of Nigeria to the traders.
Abbas Yishau, a street trader in the Ogba axis of Lagos, told Legit.ng that there is an availability of dollars in the black market.
"Right now, there is enough USD for traders in the black market. This is the reason for the massive rally in the parallel market," Yishau said.
Experts had raised alarm as the parallel market drifted further apart from the official window, leading to the CBN mopping dollars to create artificial scarcity.
Mixed performance at official market
While the parallel market recorded a sharp gain, the official window showed a marginal depreciation.
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. Although the decline was slight, it marked the second marginal depreciation within the week at the official segment.
Despite this modest setback, 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.
Policy moves driving stability
Recent interventions by the Central Bank have focused on improving dollar availability, restoring confidence, and strengthening oversight of foreign exchange transactions, according to a report by BusinessDay.
By reopening access for Bureau De Change operators and facilitating supply through banks, authorities aim to reduce pressure on the parallel market and discourage hoarding.
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 say sustained convergence between the official and parallel markets would signal deeper structural stability in the FX framework.
Source: Getty Images
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 days ahead.
CBN announces new price for dollars in black market
Legit.ng earlier reported that The Central Bank of Nigeria (CBN) has announced a major shift in its foreign exchange policy, granting licensed bureaux de change (BDCs) renewed access to the official market as the gap between official and parallel market rates continues to widen.
Under the new directive, each licensed BDC is permitted to purchase up to $150,000 per week at prevailing market rates through authorised dealer banks.
The move is aimed at boosting dollar liquidity in the retail segment and easing sustained pressure in the parallel market.
Source: Legit.ng
