Naira Appreciates Again As External Reserves Climb to Highest Level in 8 years
- The naira has strengthened further against the US dollar at the Nigerian Foreign Exchange Market
- The currency’s strong performance comes as Nigeria’s external reserves rose to their highest level since August 2018
- Experts have shared their outlook for the naira as the CBN adopts a new policy that allows BDCs to purchase dollars from banks
Legit.ng journalist Dave Ibemere has experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The naira continues to appreciate against the United States dollar in the Nigerian Foreign Exchange Market (NFEM).
Data from the Central Bank of Nigeria showed that on Tuesday, February 10, 2026, the dollar was quoted at N1,351.02, representing a 0.2% gain compared with N1,354.26 on Monday, February 9.
Source: Getty Images
In the parallel market, the currency also gained N5 to close at N1,440 per dollar, compared with N1,445 the previous day.
Why the naira is on the rise
Analysts at Quest Merchant Bank said the naira’s positive momentum reflects the CBN’s consistent reform agenda and stronger forex liquidity.
In January, the naira strengthened to N1,391 per dollar from N1,429 in December 2025, underpinned by portfolio inflows and elevated global oil prices.
Quest analysts said:
“We expect the naira to remain broadly stable and trade within a narrow band, supported by sustained FX liquidity. Stronger offshore inflows, higher FX receipts from oil, and a still-attractive carry trade environment are expected to reinforce stability.”
External reserves increase amid naira's gain
The gains come amid rising external reserves, which climbed to $47.02 billion as of February 6, 2026, according to the Central Bank of Nigeria (CBN).
This marks the highest level since August 2, 2018, when reserves stood at $47.06 billion.
Looking ahead, the CBN’s 2026 macroeconomic outlook projects that external reserves could rise further to $51.04 billion this year, supported by higher oil earnings, ongoing foreign-exchange market reforms, and continued inflows from external sources.
Source: Getty Images
Banks can now sell dollars to BDCs
Meanwhile, the CBN has approved weekly foreign currency sales of up to $150,000 to each licensed bureau de change (BDC) operator as part of efforts to improve liquidity in the currency market.
Speaking to Legit.ng on the approval, Aminu Gwadabe, the president of the Association of Bureau De Change Operators of Nigeria (ABCON), thanked the CBN on the decision to resume sales of dollars to BDCs.
He said:
“The new decision will no doubt positively impact the stability of our local currency. It will also help address the persistent and wide gap between the NFEM rate and the unregulated market.
Most importantly, the new directives will increase dollar liquidity at the critical retail end of the market and provide a reliable source of dollars to operators.
"Similarly, this move is expected to foster positive market sentiment and boost investor confidence in the sub-sector and Nigeria’s financial industry.
"I also want to use this opportunity to call on our members to ensure strict compliance with both prudential and AML/CFT obligations. Above all, it will promote transparency, accountability, and effective price discovery in the foreign exchange market.
"Over time, BDCs have proven to be one of the most potent tools in the CBN’s foreign exchange market transmission mechanism. Once again, we are delighted with this positive development and congratulate all successful BDCs nationwide."
Diaspora remittances rise
Legit.ng earlier reported that remittances from Nigerians in the diaspora surged by 200% over the past two months, reaching $600 million.
The Central Bank of Nigeria governor, Olayemi Cardoso, disclosed this development, noting that the country’s foreign exchange position is steadily improving. Speaking at the Delta State–Brazil Business and Investment Roundtable in São Paulo, he said monthly inflows rose from about $200 million to $600 million within the period.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
