Naira Strengthens Below N1,500/Euro Amid Forex Reforms

The naira has appreciated beyond the N1,500-to-the-euro mark for the first time since April 2024, closing at N1,497 per euro, a significant recovery from the N1,800 rate following the 2024 foreign exchange reforms and naira devaluation. This improvement is attributed to better domestic foreign exchange conditions and a notable weakening of the euro against the US dollar.

Central Bank of Nigeria (CBN) data indicates that the naira was previously trading at about N1,684 late last year. Jide Babalola, an economist and financial market analyst, stated that the euro-dollar cross-rate significantly influenced this movement.

He noted that if the euro weakens against the dollar while the naira remains stable against the dollar, the naira will appreciate against the euro. Additionally, improved forex liquidity and recent CBN reforms have reduced speculative pressure on the naira, which has remained stable against the dollar, trading around N1,327-N1,330/$ in the official market.