Fancy buying pounds in Lagos this Friday? You'll need N1,837 for every £1 - but compared to the chaos of last year, that's actually a sign the naira is finally catching its breath.

As reported by cbinews.tv, the British Pound closed at N1,837/£1 on the eve of the final trading session of the week, holding steady even as global currencies wobble.

And honestly, steady is the new exciting for the naira.

The numbers behind the calm

According to the Central Bank of Nigeria's data from the Nigerian Foreign Exchange Market (NFEM), GBP/NGN has been showing mild momentum rather than wild swings. Over the last 30 days, the pair has traded in a relatively tight band of **N1,805 to N1,875** per pound.

For context, the US dollar is sitting around the N1,360/$ mark in the official window.

If you've been following this market for a while, you'll know how big a deal that stability is. Remember February 2024? The naira blew past **N1,900/$** and N2,400/£ in the parallel market - an all-time low that had everyone from importers to japa hopefuls in a panic. Fast forward to now, and the currency has clawed back and held its ground for months.

So, what's changed?

Why the naira isn't free-falling anymore

The CBN, under Governor Olayemi Cardoso, basically tore up the old rulebook. Three things have mattered:

1. Reserves are back: Nigeria's foreign exchange reserves are now hovering near $53 billion, the highest in over five years. That's serious firepower to defend the naira. Back in 2023, we were struggling around the $33bn mark.

2. Real market, real volume: Daily FX turnover has exploded from under $100 million a day this time last year to regularly over $400 million, with some days hitting $1 billion, according to the apex bank. More dollars flowing through official channels means less pressure on the black market.

3. Hawkish to the core: The Monetary Policy Rate (MPR) is parked at a punishing 26.5%. The CBN is deliberately squeezing naira liquidity to tame inflation. And it's working - headline inflation is now easing and holding in the mid-teens, around 15.9%, down from 34% in late 2024, helped by better harvests.

Add in oil production back at multi-year highs and consistent trade surpluses, and even the credit agencies are noticing. Moody's recently upgraded Nigeria to B3 from Caa1, citing better transparency and debt management.

But why is the pound still so strong?

It's not just a naira story - it's a pound story too.

Sterling has been flexing globally, pushing close to $1.3495 against the US dollar in early European trading on Friday, as per cbinews.TV Market Watch.

Why? US inflation is finally cooling. US wholesale prices were flat in July, missing the expected 0.2% rise, and core Producer Price Index slowed to 0.2% month-on-month from 0.4%. Traders are now trimming bets on another Fed hike - the CME FedWatch Tool shows only a 34.8% chance of a September hike, down from 40%.

Less chance of higher US rates = weaker dollar = stronger pound.

Meanwhile, back in Blighty, the UK economy grew 0.4% quarter-on-quarter in Q2 2026, slowing from 0.6% in Q1 but bang in line with forecasts from the Office for National Statistics. Bank of England chief economist Huw Pill hinted that growth still gives the Bank room to keep rates higher for longer, which keeps sterling supported.

Geopolitics is adding spice too, with fresh tension over the Strait of Hormuz after comments from Iran's IRGC and US President Trump, pushing some safe-haven flows towards the dollar.

Bottom line: The naira's newfound composure is being tested by a resurgent pound, but for once, the CBN actually has the reserves and the rules to put up a fight.

Source: cbinews.tv

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