January 01, (THEWILL) — The naira ended 2025 at ₦1,429 to the United States dollar, marking its first full-year appreciation in 13 years and signalling a notable shift in Nigeria’s foreign exchange market.
Data from the official market show that the local currency strengthened steadily through the year, reversing a long trend of persistent depreciation driven by foreign exchange shortages, policy uncertainty, and declining investor confidence. The 2025 performance represents a significant turnaround after years of volatility that saw the naira hit record lows in previous periods.
Analysts attribute the currency’s rebound to a combination of foreign exchange reforms, improved dollar liquidity, increased inflows from exports and remittances, and tighter monetary policy by the Central Bank of Nigeria (CBN). The adoption of a more market-driven exchange rate framework and efforts to clear FX backlogs also helped restore confidence among investors and market participants.
In addition, stronger crude oil receipts and improved coordination between fiscal and monetary authorities supported external reserves, easing pressure on the naira. Diaspora remittances and renewed portfolio investments further bolstered dollar supply in the official market.
Despite the positive performance, economists caution that sustaining the gains will depend on consistent policy implementation, continued FX market transparency, and broader economic reforms to boost non-oil exports and domestic productivity.
Still, the naira’s close at ₦1,429/$1 in 2025 stands as a symbolic milestone, ending over a decade of annual declines and offering cautious optimism for currency stability in the years ahead.
Ogochukwu Onwaeze
