The naira rallies, strengthening against the US dollar amid improved economic outlook and easing demand pressures.

Central Bank reports modest gains, with the naira closing at N1,419.28 per dollar in the official market

The Nigerian currency showed some strength in the Nigerian foreign exchange market.

Naira strengthened to N1,418 against the U.S dollar on the official Nigerian Foreign Exchange Market, the CBN’s trading window for foreign currencies.

CBN data show the rate improved from N1,428 on Wednesday, a modest gain of N10.

However, on the black market, the Nigerian currency declined to N1,503/$ on Wednesday after closing at N1,480/$ on Thursday. a modest gain of N13.

Stronger growth outlook lifts confidence

The currency rally comes amid projections of stronger economic growth and moderating inflation this year.

At a hybrid roundtable organised by the Chartered Institute of Bankers of Nigeria Centre for Financial Studies in collaboration with B. Adedipe Associates, the CBN projected real GDP growth of 4.49% in 2026. International institutions share a similar outlook.

The International Monetary Fund has forecast Nigeria’s economy to grow by 4.2% in 2026, driven by higher oil production, improved security conditions, and sustained policy discipline.

The Nigerian local currency, the naira, dropped against the US dollar across Nigerian foreign exchange markets as international payments began to pick up. The naira rate suggests foreign payments surpassed US dollar volume supplied after data showed FX inflows has been on the decline.Cryptocurrency exchange comparison

Daily FX update released by the Central Bank of Nigeria (CBN) revealed that the naira on Wednesday weakened by 37 kobo against the US dollar to close at N1,420.04/$ at the official window.

The spot rate depreciation was driven by inadequate supply to meet the market demand as the naira traded within the range of N1,421.00-N1,419.00 per dollar during the session.

In the parallel market, the spot rate dipped to N1485 per dollar, reflecting a sustained surge in US dollar at the informal currency market.

Meanwhile, the External Reserve added $40.26 million to the previous day’s balance, bringing total reserves to $45.78 trillion, supported by inflows across sources amidst uncertainties around oil price projections for 2026.

Global oil prices rose on Wednesday for a fifth straight session on fears of Iranian supply disruptions due to a potential U.S. attack on Iran and possible retaliation against U.S. regional interests. Brent crude climbed 59 cents, or 0.90%, to $66.06 per barrel, while U.S. West Texas Intermediate (WTI) rose by 70 cents, or 1.15%, to $61.63.

Similarly, Gold surged to a record high, as geopolitical and economic uncertainties drove investors toward safe-haven assets, while expectations of Federal Reserve rate cuts added further momentum.

Spot gold price rose 86bps to $4,627.42/oz, while U.S. gold futures followed, edging up 76bps to $4,634.20/oz. Analysts at AIICO Capital expect market to trade mixed, with precious metals remaining supported by Fed rate-cut expectations, while oil prices trade cautiously amid mixed supply dynamics and lingering geopolitical concerns.

Nigerians will begin paying a 7.5 per cent Value Added Tax (VAT) on selected banking services, including mobile bank transfers and USSD transactions, from January 19, 2026, following a new government-backed regulatory directive.

SaharaReporters obtained a notice sent to customers on Wednesday afternoon by Moniepoint, informing users of the impending implementation of the VAT regime on certain electronic banking charges.

According to the notice, the development is tied to a directive from tax authorities mandating financial institutions to begin VAT collection and remittance.

“We would like to inform you of an upcoming government-endorsed regulatory change regarding Value Added Tax (VAT),” the notice stated.

It added, “From Monday, 19 January 2026, we are required to collect a 7.5% VAT, to be remitted to the Nigerian Revenue Service (NRS) (formerly known as the Federal Inland Revenue Service).”

The company disclosed that the tax will apply to “certain banking services,” including “electronic banking charges such as mobile banking fees (transfers), USSD transaction fees and card issuance fee.”

However, Moniepoint clarified that not all banking-related transactions would attract the tax, noting that “services that DO NOT attract VAT include: interest on deposits and savings.”

The firm also distanced itself from responsibility for the new charges, stressing that “this is not a price increase by Moniepoint.”

“Moniepoint is required to collect and remit VAT to the Nigerian Revenue Service (NRS),” the notice read.

It further explained that the tax authority had issued a clear timeline for compliance across the financial sector.

“The NRS has communicated a deadline for 19th January 2026 for all financial institutions (commercial banks, microfinance banks and electronic money transfer operators) to start collecting and remitting VAT,” the statement said.

Moniepoint also emphasised that the VAT would be limited strictly to service charges, stating that “VAT applies only to banking or service fees, not interest.”

Customers were also informed that the deductions would be clearly itemised, as “VAT charge will appear separately on your transaction reports and statements.”

The new VAT enforcement is expected to affect millions of Nigerians who rely daily on mobile banking platforms and USSD services for financial transactions.