Economy
Naira May Remain Under Pressure in 2026—Yemi Kale
By Adedapo Adesanya
Top economist, Mr Yemi Kale, has projected that the Naira will remain under pressure against the United States Dollar in 2026, due to some external pressures.
Mr Kale, who is currently the Senior Economist at Africa Export-Import Bank (Afreximbank) and formerly the Statistician-General of Nigeria, made the disclosure while delivering his keynote speech at the FirstBank Nigeria Economic Outlook 2026.
He outlines three scenario-based forecasts for the Dollar/Naira exchange rate, reflecting varying assumptions around oil prices, foreign-exchange (FX) inflows, inflation trends, and policy consistency.
Under the baseline scenario, the Naira is projected to trade around N1,350/$1–N1,450/$1 by the end of 2026.
According to the outlook, key assumptions include moderate improvement in Nigeria’s FX reserves and oil export revenues, relative stability in FX policy by the Central Bank of Nigeria (CBN), gradual decline in inflation, and the absence of major external shocks, such as a sharp oil price collapse or a global Dollar surge.
It is projected that by June 2026, Naira will trade at approximately N1,313 to the Dollar, and around N1,340/$1 by December 2026.
The outlook notes that currency risks remain elevated, justifying a cautious baseline forecast rather than expectations of strong appreciation.
It noted that the Naira would remain under pressure but avoid a sharp collapse, pointing to moderate depreciation or a mild recovery from weaker levels.
In a more positive outlook, the Naira could strengthen to between N1,200 and N1,300 per Dollar by the end of 2026.
Key assumptions include strong oil price recovery or successful export diversification, effective FX reforms by the CBN, improved liquidity, and narrower gaps between official and parallel markets, and significant decline in inflation, restoring investor confidence.
He noted that this could be buoyed by increased FX inflows from oil, gas, remittances, and non-oil exports
A weaker global US Dollar, which would support emerging-market currencies.
According to the outlook, even at N1,200, the Naira would remain significantly weaker than historical benchmarks, underscoring persistent structural challenges.
In the worst-case scenario projects the Naira could weaken to N1,550–N1,650 or beyond by the end of 2026.
Key assumptions are weak oil prices or production disruptions reducing FX inflows, deepening FX liquidity crisis and forced currency devaluation, and rising inflation, widening fiscal deficits, and erosion of investor confidence
While extreme, the scenario remains plausible given Nigeria’s structural vulnerabilities, including import dependence, FX mismatches, and inflationary pressures.
The outlook projects a gradual rebuild of Nigeria’s external reserves toward $45 billion by 2027, driven by higher remittance inflows, improved oil receipts, and portfolio investment re-entries.
He noted that policy consistency, particularly transparent FX management and fiscal discipline, is critical to sustaining investor confidence and strengthening Nigeria’s balance-of-payments position.
He added that local refining capacity could also help reduce reliance on petroleum imports, save billions of Dollars in FX annually, while export growth in agriculture, manufacturing, and services under the AfCFTA is expanding Nigeria’s non-oil FX base.
By Adedapo Adesanya
The National Pension Commission (PenCom) has defended its decision to allow Pension Fund Administrators (PFAs) to invest in the parent companies of their custodians, insisting that adequate safeguards are in place to protect contributors’ funds.
The director-general of the pension regulator, Ms Omolola Oloworaran, speaking on Tuesday during the Meet the Press Briefing at the Presidential Villa, Abuja, said the commission’s decision to relax the investment restriction followed a comprehensive risk assessment that found minimal conflict of interest.
She explained that under PenCom’s investment regulations, PFAs are only permitted to invest pension assets in carefully selected instruments that meet stringent criteria, including profitability, strong credit ratings and proven track records.
According to her, the commission regularly reviews its investment regulations, conducts routine examinations and spot checks on PFAs to ensure strict compliance with established risk management guidelines.
“PFAs cannot just go into the stock market and buy any kind of stock. There are strict guidelines. Companies must demonstrate profitability, have a proven track record and satisfy other criteria before pension funds can invest,” she said.
Ms Oloworaran noted that each PFA also operates under the oversight of a board, an investment committee and a risk management committee, providing additional layers of governance to safeguard contributors’ funds.
She said PenCom recently issued a circular allowing PFAs to invest in the parent companies of their custodians after determining that the potential conflict of interest was negligible.
The PenCom boss explained that the parent companies involved are largely Tier-1 banks, including First Bank, United Bank for Africa (UBA) and Zenith Bank, which she described as A-rated institutions with strong financial foundations.
She said the policy was intended to widen investment opportunities for pension funds without compromising safety.
Using Stanbic IBTC as an example, Ms Oloworaran explained that if its custodian is Zenith Bank, the previous restriction prevented the pension administrator from investing in Zenith Bank shares despite the bank’s strong performance.
“We reviewed the risks and any potential conflict of interest and found the risks to be very low. That is why we opened that investment window,” she said.
By Aduragbemi Omiyale
Analysts at Meristem Research have predicted that the inflation rate for June 2026 in Nigeria should marginally rise to 15.95 per cent on a year-on-year basis from the 15.93 per cent reported in May 2026.
The National Bureau of Statistics (NBS) is expected to release inflation numbers for last month later today, Wednesday, July 15, 2026.
In its report sighted by Business Post, Meristem Research said it expects inflationary pressures to re-emerge across key economies in the near term, as the re-escalation of the US-Iran conflict has reignited upward pressure on global oil prices.
It disclosed that this marks a sharp reversal from most of June, when the ceasefire between the two countries helped drive oil prices lower, raising expectations of some relief on the inflation front.
With conflicts now flaring up again, oil prices are likely to increase again, and the anticipated easing in energy-driven inflation may not materialise as broadly as earlier envisaged.
“Nonetheless, some relief is likely from the food segment, where robust supply conditions across major producing regions and softening demand should continue to ease food price pressures,” it stated.
The team also explained that it projected a 15.95 per cent inflation rate because of the lingering effects of persistent food price pressures.
“However, we expect core inflation to moderate as the sharp reversal in energy prices begins to filter through to transportation, distribution, and other energy-related costs, easing underlying price pressures.
“On a month-on-month basis, the combined effect of lower petrol prices, a relatively stable Naira, and the gradual pass-through of reduced energy costs across the supply chain should exert further downward pressure on inflation.
“Based on our assessment, food inflation is expected to remain the key swing factor, as seasonal pre-harvest supply constraints are likely to offset some of the gains from lower logistics costs,” it said.
By Adedapo Adesanya
The duo of Central Securities Clearing System (CSCS) Plc and Afriland Properties Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 1.61 per cent on Tuesday, July 14.
CSCS Plc saw its stock value drop N9.08 to close at N82.40 per share compared with the preceding session’s N91.48 per share, and Afriland Properties Plc slid by 17 Kobo to sell at N15.00 per unit versus N15.70 per unit.
The losses recorded by the two securities pulled back the market capitalisation by N41.64 billion to N2.546 trillion from N2.587 trillion, and cracked the NASD Security Index (NSI) by 69.36 points to 4,242.31 points from 4,311.67 points.
It was observed that the exchange witnessed two price advancers during the session, led by FrieslandCampina Wamco Nigeria Plc, which gained N1.37 to end at N151.37 per share compared with the previous day’s N150.00 per share, and Food Concepts Plc chalked up 5 Kobo to settle at N2.50 per unit versus N2.45 per unit.
The volume of securities traded by market participants surged by 50.7 per cent to 13.7 million units from the previous 9.1 million units, while the value of securities went down by 79.7 per cent to N65.2 million from N320.4 million, and the number of deals crashed by 3.6 per cent to 27 deals from the previous session’s 28 deals.
At the close of transactions, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with the sale of 3.4 billion units for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc, which exchanged 2.3 billion units valued at N6.5 billion, and CSCS Plc with 73.9 million units transacted for N5.2 billion.
GNI Plc also closed the trading day as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
