By David Akinmola
The naira strengthened against the British pound sterling, appreciating to N1,833/£1 in the foreign exchange market, as improving liquidity and renewed confidence in Nigeria’s currency reforms continued to support the local currency.
The latest movement reflects a modest gain for the naira against one of the world’s strongest currencies, with market analysts attributing the development to increased foreign exchange inflows, tighter monetary conditions and ongoing efforts by authorities to improve transparency in the FX market.
The pound has remained relatively resilient in global markets, supported by the United Kingdom’s economic outlook and expectations surrounding monetary policy decisions by the Bank of England. Despite this, the naira recorded gains, signaling a gradual improvement in market sentiment toward the domestic currency.
Currency traders said improved dollar supply and a reduction in speculative demand have contributed to greater stability across major currency pairs involving the naira in recent weeks.
Economic analysts noted that the appreciation could provide some relief for Nigerians making tuition payments, medical expenses and other transactions denominated in pounds sterling.
“The strengthening of the naira against the pound is a positive signal, particularly for businesses and individuals with obligations in the UK. However, sustaining the gains will depend on continued FX liquidity and broader macroeconomic stability,” said financial analyst, Ayodele Akinwunmi.
The development comes amid efforts by the Central Bank of Nigeria (CBN) to deepen reforms in the foreign exchange market and attract more foreign capital inflows into the economy.
Market observers said while the naira has shown signs of recovery against major international currencies, maintaining the momentum would require stronger export earnings, increased diaspora remittances and improved investor confidence.
A Lagos-based importer, Chukwuemeka Nnaji, said the stronger naira could help reduce the cost of transactions involving the UK market.
“Any appreciation of the naira against the pound is welcome because it lowers the cost of payments for businesses and families with commitments abroad,” he said.
Analysts believe the trajectory of the naira in the coming months will be influenced by foreign exchange inflows, crude oil earnings, monetary policy decisions and broader economic conditions both locally and globally.
