Key Highlights
- Naira depreciates to N1,390/$ on March 3, 2026.
- The currency has seen a consistent decline for nearly two weeks.
- Sustained demand pressures and liquidity concerns are impacting the local currency.
- U.S. dollar strength, driven by Middle East geopolitical tensions, is also a factor.
- Nigeria's external reserves are projected to reach $51.04 billion in 2026.
The Nigerian naira has continued its downward trajectory in the official foreign exchange market, closing at N1,390/$ on Tuesday, March 3, 2026. This marks an extension of a depreciation streak that has persisted for nearly two weeks, as reported by data from the Central Bank of Nigeria (CBN).
The latest figures reflect ongoing pressure on the local currency, attributed to concerns over foreign exchange liquidity and the strengthening of the U.S. dollar. Market data indicates a steady weakening pattern since mid-February, when the naira stood at N1,337/$ on February 17. The exchange rate has since followed a consistent downward path, with incremental losses recorded almost daily.
This sustained depreciation underscores mounting demand pressures within the official market. While the CBN has noted improvements in Nigeria's external reserve position, with projections indicating a rise to $51.04 billion in 2026 supported by stronger oil earnings, immediate liquidity challenges remain a significant concern for market participants. Analysts emphasize that while higher reserves offer a buffer, liquidity conditions and capital inflows are critical for short-term currency stability.
Externally, the U.S. dollar has seen a notable strengthening, reaching a three-month high. This surge is partly fueled by escalating geopolitical tensions in the Middle East, which have driven investors towards safe-haven assets. The dollar index held firm at 99.103, its strongest level since late November, while the euro weakened to $1.1604.
Nairametrics had previously reported on March 2, 2026, that the naira weakened to N1,376/$ as the U.S. dollar rallied globally following renewed geopolitical tensions in the Middle East. The dollar index climbed nearly 1% on Monday, marking its strongest single-day gain in seven months.