The Central Bank of Nigeria (CBN) released $4.1 billion into the foreign exchange market in the first half of 2025 to support the naira and ease pressure in the currency market. This is more than three times the $1.3 billion it injected in the same period last year. According to CSL Stockbrokers’ report, this move shows a strong effort to keep the naira stable, despite rising concerns about Nigeria’s earnings from oil and low foreign investments.
Despite this major support, Nigeria’s external reserves dropped by $3.67 billion within the same period. While some experts are worried about the long-term success of this strategy, others believe the central bank had no choice. They argue that letting the market decide the naira’s value without any regulation could lead to even worse economic instability.
The naira started the year at N1,535 to the dollar but appreciated slightly to N1,530 by June. April was the toughest month, as the naira hit N1,630 following the announcement of new U.S. tariffs, but CBN’s heavy intervention helped it recover. Some analysts warn that the naira might not maintain this stability without a boost in foreign currency inflows through oil sales, foreign investments, or loans.
Looking ahead, there are expectations that the CBN might reduce interest rates to encourage economic growth. But this could also make naira-based assets less attractive to foreign investors, which could hurt the currency again. Still, recent upgrades to Nigeria’s credit rating and talks about rejoining major international bond and stock indexes may bring in more investor confidence.
Experts agree that Nigeria still needs to rely on the CBN to keep the naira stable. For now, the country’s economy isn’t strong enough to leave the naira entirely to market forces. While interventions help in the short term, long-term growth will depend on improved exports, reduced debt, and a stronger non-oil sector.