Naira Surges to 1,480 to the Dollar in September 2025 Amid Steady Forex Reforms

By early September 2025, the Nigerian Naira had clawed back to its strongest position in over a year, hitting 1,526.54 NGN per USD on September 2 — a sharp reversal from the chaos of late 2024, when the currency plunged to 1,717.50 against the dollar. The move wasn’t a flash in the pan. Over the next four weeks, the Naira kept climbing, ending the month at 1,480.21 NGN per USD, a 3.3% monthly gain. For Nigerians who’ve watched their savings evaporate in parallel markets, this wasn’t just data — it was relief.

A Quiet Revolution in Forex Policy

The Central Bank of Nigeria didn’t announce a dramatic policy shift. No sudden devaluation. No emergency intervention. Instead, it let its Nigerian Foreign Exchange Market (NFEM) operate with more transparency, allowing dollar supply to respond to real demand rather than artificial controls. Traders noticed. Importers who’d been stuck waiting months for forex began getting allocations. Oil companies, the backbone of Nigeria’s dollar earnings, reported smoother repatriation of revenue. By September 30, the average NFEM rate stood at 1,500.60 NGN per USD — a far cry from the 1,600+ rates seen just six months prior.

What’s Driving the Surge?

It’s not just one thing. It’s a chain reaction. First, crude prices stabilized above $75 a barrel, lifting Nigeria’s export receipts. Second, foreign investors, spooked by inflation in Europe and the U.S., started looking at emerging markets again — and Nigeria, with its 27% interest rate, looked tempting. Third, the CBN quietly cracked down on illegal forex brokers, shutting down over 300 unlicensed bureaux de change in Lagos and Abuja between July and August. That reduced the black market’s grip.

"We’re seeing real demand meeting real supply," said a Lagos-based currency trader who asked not to be named. "Before, you’d pay 1,800 Naira for a dollar because the system was broken. Now, the gap between official and parallel rates is down to 5% — the narrowest in two years."

The Parallel Market’s New Reality

The Nigerian parallel market, once the heartbeat of the currency’s fate, is now a shadow of its former self. On September 30, 2025, Vanguard Nigeria reported traders expected the Naira to trade between 1,495 and 1,505 in the unofficial market — just slightly weaker than the official rate. By late October, the gap had shrunk further. On October 17, the Naira dipped to 1,475.35 in the parallel market — its weakest point that month — but bounced back within days. By November, the parallel rate hovered around 1,460, compared to the CBN’s official rate of 1,441.

Global Context: Rates, Inflation, and Investor Confidence

The U.S. Federal Reserve held its benchmark rate steady at 4.00–4.25% through October 2025, while Nigeria’s 27% rate remained one of the highest in the world. That gap — nearly 23 percentage points — made Nigerian bonds irresistible to carry traders. Foreign portfolio inflows into Nigerian government securities jumped 38% in Q3 2025, according to data from the Nigerian Securities and Exchange Commission. Investors weren’t just chasing yield; they were betting on stability.

Meanwhile, inflation, which had hovered near 30% in early 2025, fell to 22.1% by November — the lowest in 18 months. That’s not yet comfortable, but it’s moving in the right direction. "The Naira’s strength isn’t magic," said Dr. Adebayo Ogunleye, an economist at the University of Lagos. "It’s the result of patience, consistency, and a willingness to let the market breathe."

What’s Next? The Projections

Trading Economics forecasts the Naira will end 2025 at 1,448.20 per USD — a 2.4% gain from November levels — and reach 1,413.93 by November 2026. That would mean a 20% appreciation from the 2024 peak. Even the most optimistic analysts didn’t see this coming a year ago. But now, the trend is clear: Nigeria’s forex reforms are working.

The CBN’s latest monthly report noted a 14.33% year-over-year appreciation of the Naira as of November 27, 2025 — the strongest annual gain since 2019. The currency’s value, measured against a basket of global currencies, rose 9.2% in 2025 alone. "This isn’t a bounce," said one international fund manager based in Johannesburg. "It’s a re-rating. Investors are starting to see Nigeria as a country that can manage its own economy."

Still Not Out of the Woods

Don’t mistake stability for security. The Naira’s gains are fragile. A sudden drop in oil prices, a surge in imports, or political instability could unravel progress. The parallel market still exists. Many households still rely on it. And while the CBN has improved transparency, it hasn’t yet fully liberalized the forex system. There’s still a long way to go before the Naira becomes truly convertible.

But for now, Nigerians are breathing easier. Parents can buy school supplies without losing half their savings to black market spreads. Small businesses can import raw materials without waiting months. And for the first time in years, people are talking about saving in Naira again — not just in dollars.