The Nigerian Naira recorded its most stable performance in months throughout September 2025, consistently trading below the ₦1,500 per dollar mark and ending the month at ₦1,478/$1, according to data published by the Central Bank of Nigeria (CBN).
This closing rate on September 30 represents a sharp recovery from the ₦1,527.90/$1 rate recorded on the first day of the month. Analysts say the currency’s performance signals growing market confidence, backed by improved FX reserves and cautious policy adjustments by the apex bank.
A closer look at the currency’s month-end trajectory shows the Naira began gaining ground steadily from mid-September. On the 15th, it breached the psychological ₦1,500/$1 barrier, trading at ₦1,495. The upward trend continued in the following days: ₦1,486.8 on September 24, ₦1,485 on the 25th, ₦1,480 on the 26th, and ₦1,480.15 on the 29th, before closing stronger at ₦1,478 on the final trading day.
A Turnaround Month Compared to Prior Trends
September’s performance stands out starkly when compared to earlier months in 2025. The Naira ended December 2024 at ₦1,535/$1 and slightly appreciated to ₦1,475/$1 in January 2025, previously the best monthly close until now. However, the first quarter saw the local currency come under pressure, with rates depreciating to ₦1,500 in February, ₦1,537 in March, and a sharp decline to ₦1,602 in April, marking its weakest point so far this year.
May closed at ₦1,585.50/$1, while marginal gains were recorded in June (₦1,532), July (₦1,534), and August (₦1,531).
Unlike January, where the Naira only briefly dipped below ₦1,500/$1 on two trading days, September delivered a consistent run of sub-₦1,500 performance for more than half the month a sign, some observers say, of potential longer-term currency stability.
Reserves Hit 6-Year High, Boosting Confidence
In a further boost to the macroeconomic outlook, Nigeria’s external reserves rose to $42.3 billion as of September 29, the highest level since September 2019, when reserves peaked at $41.99 billion. The CBN’s data shows an increase of over $692 million within just 18 days in September.
This surge in reserves is tied to increased FX inflows, growing investor confidence, and a more transparent, market-driven exchange rate framework introduced by the CBN earlier this year.
Policy Shift at CBN to Support Growth and Stability
Speaking after the Monetary Policy Committee (MPC) meeting held on September 22, CBN Governor Olayemi Cardoso attributed the currency’s improved stability and rising reserves to bold economic reforms and renewed transparency in monetary operations.
“Exchange rate stability is key. If we are going to continue to moderate inflation the way we have, exchange rate stability is key. Fiscal discipline is key,” Cardoso emphasized.
In a cautious policy adjustment, the CBN trimmed the Monetary Policy Rate (MPR) by 50 basis points, bringing it down from 27.5% to 27%. The asymmetric corridor around the MPR was also revised to +250 and -250 basis points, replacing the previous wider margin of +500/-100 basis points.
The Cash Reserve Ratio (CRR) remains at 45% for commercial banks and 16% for merchant banks.
The central bank reaffirmed its commitment to fighting inflation and maintaining stability, particularly as Nigeria approaches the 2026 pre-election period, a time typically marked by increased spending and volatility.
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