Naira Holds Near N1,762 Per Pound Despite CBN's 350 Basis Point Rate Cut
By Aboki Forex —
The naira is trading at about N1,762 to the British pound in the official market, holding its ground even after the Central Bank of Nigeria cut its benchmark interest rate. Sterling has eased from levels around N1,800 earlier in September, extending a run of improvement for the Nigerian currency.
The pound traded at roughly N1,948 at the beginning of 2026, which means the naira has gained considerable ground against sterling since the start of the year. Exchange rates remain exposed to both domestic and international developments.
Rate cut fails to knock the naira
The CBN's Monetary Policy Committee reset the Monetary Policy Rate to 23%, down from 26.5%. That is a reduction of 350 basis points. Lower interest rates normally weaken the appeal of naira-denominated assets to foreign investors and can put pressure on a currency.
The naira has stayed relatively resilient against major foreign currencies instead. Improved dollar liquidity and stronger external buffers are providing support to the foreign exchange market. The CBN also retained the Cash Reserve Requirement for deposit money banks at 45%, while the CRR for merchant banks stayed at 16%.
Reserves above $55 billion
CBN Governor Olayemi Cardoso said this week that external reserves had risen above $55 billion. That gives Nigeria a stronger buffer against external shocks and improves the country's capacity to meet foreign exchange obligations.
Higher reserves tend to strengthen confidence in the FX market because the monetary authorities have more room to respond when dollar demand spikes.
Dollar liquidity in the Nigerian Foreign Exchange Market is another key driver of the naira's value against other currencies. As a major crude oil exporter, Nigeria depends on oil production and international crude prices for foreign exchange supply. Improved oil receipts raise dollar inflows. Weaker production or falling prices do the opposite. Remittances and portfolio investments also add to liquidity in the official market, according to Central Bank of Nigeria data.
Why the pound moves
The pound-to-naira rate is not driven by Britain alone. It also reflects how the naira performs against the US dollar. The CBN currently displays the official dollar exchange rate at around N1,328.50/$, alongside the new 23% benchmark interest rate.
That means stronger dollar supply in Nigeria can push the GBP/NGN cross-rate lower even when sterling is doing well internationally.
For businesses, travellers and Nigerians paying school fees or other bills in Britain, the next move in the pound will depend on domestic FX liquidity, Nigeria's external reserves, oil earnings and developments in global currency markets.
Steadier sterling pricing gives importers and families with pound obligations some room to plan, though the market remains sensitive to any shift in reserves or oil earnings.