SAT JAN 03 2026-theGBJournal| The Nigerian naira began 2026 stronger on Friday, snapping up one of its strongest gains against the U.S. dollar as investors look ahead to this year’s critical economic data that could steer the Central Bank of Nigeria’s (CBN) policy.
The official FX rate rose by 2bps to N1,434.76/US$1. The rise follows the sharpest weekly decline in total FX inflows.
FX inflows fell to about US$74.8 million, down roughly 95% week-on-week from US$1.46 billion previously by close of official trade in 2025.
The CBN, in its Macro Economic Outlook for 2026 projects that the reforms in the FX market are expected to further enhance efficiency and transparency, narrow the premium between the NFEM and BDC rates, and sustain exchange
rate stability.
In addition, improved domestic oil refining capacity is expected to reduce FX demand for fuel imports.
At the fixed income market, the NTB secondary market traded on a quiet note with a bullish undertone as the average yield contracted by 1bp to 17.7%.
Across the curve, the average yield contracted at the short (-1bp) and mid (-9bps) segments driven by buying interest for the 48DTM (-2bps) and 188DTM (-2bps), respectively, but remained unchanged at the long end. Conversely, the average yield expanded by 6bps to 21.9% in the OMO segment.
Elsewhere, the FGN bond secondary market traded on a bullish note, as the average yield contracted by 1bp to 16.4%. Across the benchmark curve, the average yield remained unchanged at the short end, but expanded at the mid segment (+1bp) due to sell off of the JUN-2033 (+3bps) bond.
The average yield contracted at the long end (-2bps) due to the demand for the JUN-2053 (-19bps) bond.
Meanwhile, the outlook for yields in 2026 reflects a relatively lower trend of the yield curve compared with 2025, according to the CBN.
The apex bank said the short-end of the curve is projected to rise consistently above the long-end of the horizon in 2026, driven by a lower interest rate environment, liquidity conditions, risk appetite of the government, as well as the stability of the economy.
The forecast portrays an inverted yield curve owing, largely to expectations of lower interest rates in the future, following the projected disinflationary path of the price level, consistent with economic growth.
The overnight lending rate remained unchanged at 22.8%, closing at a net long position (N3.36 trillion)
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