The naira strengthened against the dollar in September 2026 as the average spot exchange rate fell by 1.86 per cent to N1, 328.28 per dollar, down from N1, 353.41 in August.

The lower average exchange rate indicated an improvement in the naira’s value against the dollar during the period under review.

September performance also reflected reduced fluctuations in the foreign exchange market, with the local currency trading within a narrower range than the preceding month.

Foreign exchange data showed the naira traded between N1,320 and N1,334 per dollar in September, compared with a wider range of N1,335.50 to N1,365.10 in August.

The narrower trading range suggests that exchange rate movements became less volatile during the month, as the difference between the highest and lowest rates reduced to N14 in September from N29.60 in August.

This represents a reduction of N15.60, or approximately 52.70 per cent, in the monthly trading range.

The figures indicated that the naira recorded both an improvement in its average exchange rate and a reduction in the extent of its price movements in September. While the average rate fell by N25.13, the gap between the currency’s highest and lowest trading rates also narrowed considerably.

The decline in the average exchange rate means fewer naira were needed, on average, to buy one dollar during the month. In August, the average rate stood at N1,353.41 per dollar, but this fell to N1, 328.28 in September, representing an appreciation of approximately 1.86 per cent.

Similarly, the September trading range remained below the August range throughout the period. The highest rate recorded in September, N1, 334 per dollar, was N1.50 below the lowest reported rate in August, N1, 335.50. The lowest September rate of N1, 320 was N45.10 below the highest August rate of N1, 365.10.

The naira’s improved average exchange rate and moderated volatility indicate more stable trading conditions in the foreign exchange market during September.

A stronger naira could reduce the local-currency cost of dollar-denominated purchases for businesses that depend on imported raw materials, machinery, and other foreign inputs, provided the improvement is reflected in the rates at which they can access foreign exchange.

A more stable exchange rate could improve planning for businesses with foreign currency obligations by reducing uncertainty about the naira amount needed to meet dollar payments.

Companies with significant import bills or foreign currency-denominated debts would also benefit if the improved exchange rate and lower volatility persist.

For consumers, sustained appreciation would help moderate the cost of imported goods and production inputs, although the extent to which such gains translate into lower retail prices would depend on other costs, existing inventories and the speed at which businesses adjust their prices.

The sustainability of the improvement would depend on developments in foreign exchange supply and demand and other market conditions in the months ahead.