The Nigerian naira closed the month of November on a softer footing, exchanging at N1,446.90 to the US dollar on November 28, compared with N1,438 at the start of the month and N1,427.50 at the end of October.
The currency’s mild 0.6% depreciation in November came despite the Central Bank of Nigeria maintaining one of the world’s most restrictive monetary policy stances, underscoring the persistent challenges facing Africa’s largest economy in stabilising its foreign exchange market.
November’s pressure was relatively contained compared with October’s intense volatility. The naira only briefly crossed the psychological N1,450-per-dollar mark for five consecutive trading days between November 18 and 24, peaking at N1,459.95 on November 20. In contrast, October saw the local currency trade above N1,450 for 18 straight sessions, with a monthly high of N1,474 recorded on October 16.
Analysts attributed the relative calm in November to a combination of seasonal moderation in import demand toward year-end and the lagged impact of the CBN’s aggressive tightening cycle, which has lifted the benchmark Monetary Policy Rate to 27% while keeping the Cash Reserve Ratio at a punitive 45% for commercial banks.
At its 303rd Monetary Policy Committee meeting held November 24–25, the apex bank opted to leave all policy parameters unchanged, signalling confidence that the current ultra-tight settings are gradually anchoring inflation expectations. Headline inflation had slowed to 16.05% in October from 18.02% the previous month.
Speaking at the Chartered Institute of Bankers of Nigeria’s annual dinner last week, CBN Governor Olayemi Cardoso revealed that the bank is putting finishing touches to a comprehensive revision of the foreign exchange manual. The updated guidelines are designed to enhance transparency, widen eligible participant pools, tighten documentation standards, and strengthen electronic monitoring of FX transactions.
Market participants say the forthcoming rules could prove pivotal in reducing arbitrage opportunities and rebuilding investor confidence in the naira, which has lost more than 40% of its value since the central bank unified the multiple exchange rate windows in mid-2023.
While the naira’s slide has slowed in recent weeks, analysts caution that sustained stability will hinge on a meaningful increase in foreign currency inflows, particularly from oil exports and foreign portfolio investments, areas that remain hampered by global commodity price swings and domestic security concerns.
