The USD to NGN exchange rate shows a bearish bias as recent developments indicate a downward trend for the US dollar. Key drivers include the Federal Reserve's expected interest rate cuts, which could weaken the USD further, and anticipated inflation growth in Nigeria, projected to reach 37% in 2026. Additionally, global economic growth and rising commodity prices may impact the performance of both currencies.
The near-term trading range for the USD to NGN is likely to remain within a stable corridor, following its recent performance, as USD at 1455 remains close to its three-month average. This stability comes despite the Nigerian Naira facing pressures from external factors and projected depreciations, with estimates suggesting potential movements towards 1692.6 NGN by late 2026.
Upside risks for USD strength could arise from improvements in US consumer sentiment, which might support the dollar temporarily. Conversely, downside risks remain pronounced due to the long-term implications of high Nigerian inflation and global uncertainties that could harm the Naira's value.
