The Nigerian naira strengthened against the U.S. dollar last week, gaining 0.80% in the official market to N1,355.42 and 2.69 per cent in the parallel market to N1,392.49.
Nigeria’s external reserves also rose modestly by 1.54% to $47.53 billion, supported by the Central Bank of Nigeria’s approval of weekly foreign exchange sales of $150,000 to Bureau De Change operators.
In the oil market, prices declined on Thursday following the International Energy Agency’s downward revision of its 2026 global demand growth forecast. Brent Crude traded at $67.21 per barrel, down 0.11% for the session, while U.S. WTI slipped to $62.69.
The IEA reduced its demand growth outlook to 850,000 barrels per day, down from the previous estimate of 930,000 barrels. In contrast, Bonny Light crude rose 1.54% to $73.73 per barrel.
We expect the naira to maintain a modestly firm trend in the short term, supported by the Central Bank of Nigeria’s continued FX interventions and steady external reserves. However, pressure in the parallel market may persist if supply-demand imbalances widen.
In the oil market, prices could remain volatile, reflecting uncertainties around global demand growth and production trends. Brent and WTI are likely to hover near current levels, while Bonny Light may see moderate gains if domestic supply dynamics and geopolitical factors remain favourable.
We expect the bond market to remain firm in the near term, supported by sustained system liquidity, reinvestment of coupon flows, and continued investor preference for relatively attractive real yields.
However, sentiment will remain sensitive to inflation dynamics, monetary policy direction from the Central Bank of Nigeria, and developments in the foreign exchange market.
In the Eurobond segment, performance is likely to be influenced by global risk appetite, U.S. Treasury yield movements, and Nigeria’s external reserve position. Barring adverse external shocks, demand for Nigerian sovereign papers could remain resilient, keeping yields relatively
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