Naira Depreciation Deepens Amid Black Market Pressures

As of February 5, 2026, the Nigerian naira has experienced further depreciation against major currencies in the black market, with rates reaching 1,435 naira per US dollar and 1,670 naira per euro. This decline highlights the growing gap between demand and supply of foreign currency, raising concerns about the stability of Nigeria's foreign exchange market.

Traders attribute the naira's weakness to persistent scarcity of foreign exchange, driven by high demand for imports and travel. The challenges stem from long-standing structural issues rather than sudden market shocks, including inconsistent monetary policies that deter foreign investment.

The Central Bank of Nigeria (CBN) has faced criticism for its frequent changes in foreign exchange regulations, which have left businesses uncertain and reliant on the black market. The situation is compounded by external pressures such as oil price volatility and inflation, leading to increased costs of living for Nigerians.

Without consistent policies to improve exports and restore investor confidence, the naira is expected to continue its downward trend.