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Analysts predict stronger, stable naira in 2026 on rising FX inflows, reforms - BLUEPRINT
Economic analysts and Bureau De Change (BDC) operators have projected a more stable and potentially stronger naira in 2026, citing rising foreign exchange (FX) inflows, sustained monetary tightening, and ongoing structural reforms across Nigeria’s economy.
Market operators, economists and policy analysts say recent developments in the forex market suggest that demand and supply dynamics are gradually improving, setting the stage for enhanced currency stability this year.
A key driver of the improved outlook, analysts say, is the gradual restoration of confidence in Nigeria’s forex market following reforms introduced by the Central Bank of Nigeria (CBN).
BDC operators note that the reforms have significantly narrowed the gap between official and parallel market rates, weakening incentives for arbitrage and speculative dollar hoarding.
Muhammed, a Lagos-based BDC operator, said liquidity conditions have improved noticeably in recent months.
“The dynamics of the market are changing. As confidence improves and liquidity increases, more people are willing to sell dollars rather than hold on to them,” he said.
Analysts also expect forex inflows to strengthen further in 2026, driven largely by higher crude oil output, improved security around oil-producing areas and stricter enforcement against oil theft.
On the policy front, analysts stress that fiscal and monetary discipline will be critical to sustaining gains.
The CBN’s firm stance on inflation control, alongside efforts to curb deficit financing and improve revenue mobilisation, is viewed as essential to protecting the naira’s purchasing power and strengthening investor confidence.
However, analysts caution that risks remain, particularly from potential pre-election spending pressures.
As political activities intensify ahead of future elections, concerns have emerged that unchecked fiscal expansion could place renewed pressure on the currency.
Ibrahim Kazeem, a Lagos-based economist, warned that election-related spending could become a key risk factor if not carefully managed.
