The Nigerian currency appreciated to N1,365 per dollar on Thursday, gaining slightly against the U.S. dollar amid a broader decline in the global value of the greenback.

Data from the Central Bank of Nigeria (CBN) showed that the naira strengthened from N1,369/$ recorded on Wednesday, reflecting improved investor sentiment in global currency markets.

Global Dollar Weakness Drives Gains

The naira’s appreciation comes as the U.S. dollar heads for its sharpest weekly decline since January, driven by easing geopolitical tensions and renewed optimism over a ceasefire in the Gulf region.

Market analysts attribute the shift to expectations that oil shipments will resume through key global routes, particularly the Strait of Hormuz, following the ceasefire agreement.

Further direction in currency markets is expected to depend on ongoing diplomatic engagements between the United States and Iran.

Market Data Signals Currency Shift

Recent market data highlights a broad-based weakening of the U.S. dollar:

• The U.S. Dollar Index declined by 1.3 per cent this week
• The naira traded within a range of N1,351.5/$ to N1,365/$, with an average rate of N1,359.9/$
• Nigeria’s external reserves fell to $48.89 billion, down from $49.18 billion earlier in April

The weakening dollar reflects a shift away from safe-haven assets as geopolitical tensions begin to ease.

Major Currencies Gain Ground

Other global currencies also strengthened against the dollar:

• The euro rose to $1.1690
• The British pound gained 1.8 per cent to $1.3424
• The Chinese yuan appreciated to 6.83 per dollar in offshore trading
• The Australian and New Zealand dollars recorded weekly gains of nearly 3 per cent

These movements signal renewed investor confidence and a transition toward risk-sensitive assets.

Geopolitical Tensions Ease

The recent improvement in global currency markets follows weeks of heightened geopolitical uncertainty.

In March, tensions linked to the Middle East crisis drove investors toward the dollar as a safe-haven asset, strengthening the currency significantly.

However, the ceasefire agreement has led to a reversal of these positions, triggering a decline in the dollar’s value.

Despite the progress, uncertainties remain, particularly around shipping activity in the Strait of Hormuz, which has yet to return to normal levels.

Implications for Nigeria

For Nigeria, a weaker dollar could provide short-term relief for the naira, especially given the country’s dependence on oil exports and external reserves.

However, the continued decline in foreign reserves may limit the sustainability of the currency’s gains if not supported by stronger inflows.

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The Nigerian currency, the , appreciated to N1,403 per dollar in the parallel market, strengthening from N1,408 recorded earlier in the week.

At the official window, the naira also improved to N1,345 per dollar in the Nigerian Foreign Exchange Market (NFEM), reflecting stronger performance across both segments.

Data from the (CBN) showed that the indicative exchange rate dropped from N1,355 to N1,345 per dollar, indicating a N10 appreciation.

Gap between markets narrows

As a result of the gains, the gap between the parallel market and the official exchange rate narrowed to N48 per dollar, down from N53 recorded previously.

Positive signal for forex stability

The appreciation is seen as a positive signal for Nigeria’s foreign exchange market, amid ongoing efforts by the CBN to stabilise the currency and improve liquidity.

Analysts say sustained gains will depend on continued forex supply, policy consistency, and improved investor confidence.

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