Naira Gains Against Euro, Trades at N1,606/€1

The Nigerian naira strengthened against the euro during Thursday’s trading session, closing at N1,606/€1, up from Wednesday’s N1,644/€1, according to Central Bank of Nigeria (CBN) data.

Market watchers attributed the gains to bullish momentum from naira investors, which eased pressure on the EUR/NGN rate.

Analysts say the naira’s recent appreciation against major currencies, including the U.S. dollar and euro, reflects improved foreign exchange inflows, fiscal reforms, and stronger external reserves. Nigeria’s reserves now stand at about $46.7 billion, giving the CBN more capacity to defend the currency.

Despite the gains, the CBN remains cautious with monetary policy. It cut its benchmark rate only once in 2025, holding it at 27% to control inflation and sustain investor confidence.

High yields on CBN bills have attracted foreign portfolio investors, boosting demand for the naira.

Nigeria’s trade surplus with the European Union also supports the currency. In 2025, the country recorded a $10 billion surplus, driven largely by exports of crude oil, gas, and cocoa. Key trading partners include Germany, the Netherlands, Belgium, France, and Spain.

Meanwhile, Eurozone challenges have limited the euro’s strength. Inflation fell to 1.7%, below the European Central Bank’s 2% target, sparking speculation of rate cuts.

Economic growth is projected at just 1.2% in 2026, leaving room for the naira to gain ground.

French President Emmanuel Macron is expected to raise concerns about the euro’s competitiveness at the upcoming EU summit, while U.S. President Donald Trump’s comments on the dollar’s decline have fueled volatility in euro-dollar markets.

EU policymakers are also pushing to expand the euro’s international role to reduce reliance on the dollar, but for now, Nigeria’s currency gains highlight the impact of reforms, reserves, and trade surpluses in stabilizing the naira.