Naira Hits Five-Month High at N1,349 as CBN Cash Rule Boosts FX Liquidity, Dollar Slides
- The naira climbed to its strongest level since April 2026 on Monday, driven by a CBN policy shift on bank borrowing access
- Interbank FX turnover surged by over 265% to $437.53 million, the highest single-day volume recorded since July 22, 2026
- Nigeria's external reserves reached $52.25 billion as of August 13, 2026, their highest point in 17 years
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Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The naira strengthened to a five-month high on Monday, August 17, 2026, as increased activity in the foreign exchange market coincided with the Central Bank of Nigeria’s latest policy adjustment affecting banks’ access to its Standing Lending Facility (SLF).
The local currency appreciated by N8.07 against the US dollar, with the dollar quoted at N1,349.54 at the Nigerian Foreign Exchange Market (NFEM), compared with N1,357.61 on Friday. The movement represents a 0.59 per cent gain for the naira.
Source: Getty Images
The latest exchange rate marks the strongest level recorded by the naira since April 22, 2026, when the dollar traded at N1,348.45 in the official market.
The CBN recently removed restrictions that had prevented banks from accessing its SLF, also known as the discount window, after participating in foreign exchange transactions and primary auctions of government securities.
The policy change is expected to improve banks’ access to liquidity and strengthen the transmission of monetary policy across the financial system.
FX turnover jumps 266 per cent
Trading activity also surged sharply on Monday, underscoring increased liquidity and participation in the interbank FX market.
The number of deals rose by 29.93 per cent to 178 from 137 recorded on Friday, while total turnover jumped 265.86 per cent to $437.53 million.
Monday’s turnover was the highest recorded since July 22, when the market registered significant trading activity. It also represented a sharp increase from the $119.59 million recorded on Friday.
At the parallel market, the naira also gained ground, strengthening to N1,410 per dollar from N1,420 last week.
The improvement narrowed the gap between the official and parallel market rates to 4.48 per cent on Monday, from 4.64 per cent on Friday.
The narrowing spread suggests that exchange-rate movements across the two markets are becoming more closely aligned, although a significant difference remains.
Rising reserves strengthen CBN’s position
The naira’s latest gains are coming against the backdrop of stronger external reserves, which provide the CBN with additional capacity to manage foreign exchange liquidity and meet the country’s international obligations.
Nigeria’s external reserves rose to $52.25 billion as of August 13, 2026, their highest level in 17 years.
The latest figure represents a 28.32 per cent increase from the $40.72 billion recorded during the corresponding period of 2025, according to a report by BusinessDay.
The sustained rise in reserves, alongside improved FX market liquidity, has provided a stronger backdrop for the naira after months of volatility.
Source: Getty Images
What the latest move means
The combination of higher FX turnover, rising reserves and easier access to the CBN’s liquidity facility points to a changing landscape for Nigeria’s foreign exchange market.
For businesses and consumers, a more stable naira could ease pressure on the cost of imported goods and services if the trend is sustained.
However, the durability of the naira’s recent gains will depend on continued FX liquidity, reserve accumulation, market confidence and the CBN’s ability to maintain orderly conditions in the currency market.
CBN crashes dollar as demand increases
Legit.ng earlier reported that the Central Bank of Nigeria sharply ramped up its foreign exchange interventions in March 2026, selling $953.41m to the market in what the data shows is the strongest central bank FX activity since April 2025.
Figures published in the CBN's latest Quarterly Statistical Bulletin showed that spot market transactions made up the bulk of the March sales, with $950.10m channelled through that route and a further $3.31m directed to Ministries, Departments and Agencies.
Source: Legit.ng
