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Naira’s maximum depreciation between March and June was 2.6 percent, compared with 10 percent for Ghana’s cedi.
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Only 10 of 22 African currencies tracked by the World Bank remained weaker than their end-February positions by August.
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Higher oil prices and stronger foreign exchange inflows helped shield Nigeria from some of the currency pressures experienced by other African economies.
October 8, (THEWILL) – The naira was among the more resilient African currencies during the second quarter of 2026, weathering a period of heightened exchange-rate pressure triggered by geopolitical tensions, higher energy prices and stronger demand for the US dollar, the World Bank has said.
According to the World Bank’s October 2026 Africa Economic Update, the naira’s maximum depreciation between March and June was 2.6 percent, significantly below the losses recorded by several other African currencies during the period.
Ghana’s cedi recorded the sharpest decline among the currencies highlighted by the bank, depreciating by as much as 10 percent.
The currencies of South Africa, Lesotho, Namibia and Eswatini fell by up to 7.2 percent, while the Democratic Republic of Congo and Uganda recorded maximum declines of 6 percent and 5 percent, respectively.
Naira Recovers As Oil Prices Support Inflows
The World Bank reviewed exchange-rate movements across 22 African countries outside the CFA franc zone, comparing currency performance with levels recorded before the escalation of the Middle East conflict.
Nigeria’s currency subsequently recovered some of its losses. By August, the naira had strengthened by 1.9 percent from its March-to-June lows, placing it among the currencies that regained ground after the period of heightened pressure.
The recovery compared favourably with several regional peers.
Ghana’s cedi remained 2.5 percent below its end-February level by August, while Uganda’s currency was still down 3.1 percent. South Sudan recorded one of the largest remaining declines at 5.5 percent.
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Overall, only 10 of the 22 currencies monitored by the World Bank remained weaker than their end-February positions by the end of August.
The World Bank attributed part of the naira’s relative resilience to Nigeria’s position as a major crude oil exporter.
Higher oil prices increased export earnings and foreign exchange inflows for oil-producing economies such as Nigeria and Angola, providing some support for their currencies at a time when several African markets were facing increased pressure.
For countries heavily dependent on imported fuel and other energy products, however, the increase in global energy prices created additional pressure on foreign exchange demand and external balances.
Dollar Demand, Capital Outflows Weigh On Currencies
The currency sell-off across several African markets was not driven by energy prices alone.
The World Bank identified stronger demand for the US dollar, capital outflows from emerging and frontier markets and concerns over the rising cost of servicing dollar-denominated debt among the factors that contributed to the pressure on African currencies.
The relative performance of the naira comes against the backdrop of broader improvements in Nigeria’s macroeconomic outlook.
The World Bank has raised its 2026 growth forecast for Nigeria to 4.3 percent, from an estimated 4 percent expansion in 2025.
It expects the Nigerian economy to grow by 4.4 percent in both 2027 and 2028, linking the improved outlook to greater macroeconomic stability, stronger investor confidence and a gradual recovery in private investment.
However, the bank cautioned that currency stability and economic growth remain exposed to several risks.
These include tighter global financial conditions, a prolonged Middle East conflict, insecurity, climate-related shocks, disruptions to crude oil production and increased government spending ahead of the 2027 elections.
The World Bank therefore stressed the need for Nigeria to sustain its economic reforms and build stronger policy buffers to protect the gains made in macroeconomic stability.
For the naira, the latest assessment marks a significant shift from the severe exchange-rate volatility that characterised earlier periods, but the bank’s warning underscores that recent resilience will depend on Nigeria’s ability to maintain foreign exchange inflows, strengthen fiscal and monetary buffers and manage external shocks.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
