Naira heads for best year in nearly a decade as Bloomberg survey sees 12% gain
By Aboki Forex —
The naira is on course for its strongest annual performance since at least 2018, with analysts polled by Bloomberg projecting a full-year gain of 12 per cent on the back of President Bola Tinubu's economic reforms. The currency has already risen 8.0 per cent this year and is expected to keep climbing.
Bloomberg's survey, released on Wednesday, said the naira could close 2026 at N1,290 per dollar, stronger than its N1,328.92 close the same day. The projected 12 per cent gain would be the currency's best annual showing since at least 2018.
FTSE Russell upgrades Nigeria to frontier market
Global index provider FTSE Russell has also confirmed Nigeria's reclassification from "Unclassified" to "Frontier Market Status," effective from the start of trading on September 21, 2026. The upgrade followed favourable reviews from the FTSE Equity Country Classification Advisory Committee, which found no material settlement, operational or funding issues around the Nigerian market despite the shift from a T+2 to a T+1 settlement cycle on June 1, 2026.
As part of the upgrade, FTSE Russell added 30 Nigerian companies to its FTSE Frontier Index Series. Ten large-cap stocks were classified as "Newly Eligible": GTCO Plc, Zenith Bank Plc, MTN Nigeria Communications Plc, Dangote Cement Plc, Stanbic IBTC Holdings Plc, Aradel Holdings Plc, First HoldCo Plc, Nestlé Nigeria Plc, Nigerian Breweries Plc and Presco Plc.
Other listed firms include Oando Plc, United Bank for Africa, Okomu Oil Palm Plc, Access Bank Plc, Dangote Sugar Refinery Plc, FCMB Group Plc, Fidelity Bank Plc, Guinness Nigeria Plc, Unilever Nigeria Plc, Wema Bank Plc, Custodian and Allied Insurance Plc, Fidson Healthcare Plc, Julius Berger Plc, NASCON Allied Industries Plc, NAHCO Plc, NGX Group Plc, Vitafoam Nigeria Plc, Sterling Financial Holdings Company Plc, Transcorp Plc, U A C of Nigeria Plc and United Capital Plc.
Reserves, oil output and GDP support the outlook
Nigeria's external reserves hit an 18-year high of $53.99 billion on Wednesday, well above the Central Bank of Nigeria's $51.04 billion year-end target for 2026. Bloomberg attributed the stronger position to rising remittance inflows, higher oil revenues and improved foreign exchange liquidity from recent reforms.
"Nigeria's currency is headed for its best performance in almost a decade, as rising dollar inflows from higher oil prices and remittances help insulate the naira from political risks usually associated with its election season," Bloomberg said. With liquid reserves of $52.5 billion, the country can support more than 12 months of imports, its strongest forex capability in recent years.
Brent crude traded around $95.5 per barrel on Wednesday, far above Nigeria's 2026 federal budget benchmark of $64.85. The price rebound is expected to boost fiscal revenues and support the naira.
Dr Muda Yusuf, Chief Executive Officer of the Centre for the Promotion of Public Enterprise, said the outlook for external reserves remains positive. "Well, the outlook for me is positive because I don't see anything derailing these forex reforms, fuel subsidy etc. It is these reforms that have brought about stability," he said.
The Q2 2026 GDP report from the National Bureau of Statistics showed average daily crude oil production rose to 1.72 million barrels per day in the second quarter, up from 1.68 mbpd in Q2 2025 and 1.55 mbpd in Q1 2026. The oil sector contributed 4.16 per cent to real GDP, compared with 4.05 per cent a year earlier and 3.92 per cent in Q1 2026.
Overall real GDP growth accelerated to 4.43 per cent in Q2 2026, from 3.89 per cent in the previous quarter and 4.23 per cent in Q2 2025.
What it means for the naira
The combination of higher reserves, improved oil output and Nigeria's return to frontier market status strengthens the naira's near-term outlook. Increased global investor interest in Nigerian stocks could bring more dollar inflows, further supporting the currency and easing pressure on consumers and businesses that rely on foreign exchange.