Currency strengthens slightly in official markets even as parallel rate slips, analysts eye policy signals
The Naira recorded modest gains across official foreign exchange markets on Monday, ahead of the highly anticipated 303rd Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN), scheduled for November 24–25, 2025 in Abuja.
Data from the CBN shows the Naira closed at ₦1,452 to $1 on Monday, improving from ₦1,458 to $1 recorded last Friday. Meanwhile, the parallel market told a slightly different story, with the currency slipping to ₦1,472 to $1 from Friday’s ₦1,462 to $1.
The mixed performance reflects heightened market positioning ahead of the MPC meeting, where analysts expect the Committee to weigh Nigeria’s complex macroeconomic landscape, including rising external reserves, slowing inflation momentum, and persistent pressures on the Naira.
Background to the Upcoming MPC Meeting
At its previous session, the MPC surprised markets by cutting the Monetary Policy Rate (MPR) by 50 basis points, from 27.5% to 27%, its first easing move in months. The Committee also narrowed the asymmetric corridor around the MPR to +250/-250 basis points, down from +500/-100, a step interpreted as an effort to enhance liquidity management while signaling cautious optimism over the economy.
Other key parameters were retained:
- Cash Reserve Ratio (CRR) for commercial banks: 45%
- CRR for merchant banks: 16%
- Liquidity Ratio: 30%
The upcoming meeting is expected to be closely watched as the MPC navigates rising FX reserves alongside ongoing Naira pressures.
Analysts’ Outlook
Standard Bank analysts project the Naira will close December 2025 at ₦1,458.8/$1, supported by improved FX reserves, strong banking system liquidity, and growing investor confidence in Naira assets. The currency has remained below ₦1,500 per dollar since September 15, reflecting the CBN’s sustained stabilization efforts.
In earlier projections, the bank had anticipated a year-end rate of ₦1,585.5/$1, down from a previous forecast of ₦1,697.5/$1, citing potential pressures from political developments and fiscal spending ahead of the 2027 general elections.
During the December 2024 budget presentation, President Bola Tinubu projected that inflation would decline from 34.6% to 15% in 2025, while the exchange rate would improve from around ₦1,700/$1 to ₦1,500/$1.
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