The World Bank has reported that the naira depreciated by a maximum of 2.6% between March and June 2026, considerably less than several other African currencies. This is despite exchange rate pressures triggered by geopolitical tensions, rising energy prices, and increased demand for the US dollar. The bank’s report examined exchange rate movements across 22 African countries outside the CFA franc zone.
Ghana’s cedi recorded the steepest decline among the currencies highlighted, losing up to 10% between March and June. The currencies of South Africa, Lesotho, Namibia, and Eswatini weakened by as much as 7.2%, while the Democratic Republic of Congo and Uganda recorded maximum depreciations of 6% and 5% respectively. These countries' currencies were more vulnerable to global financial pressures.
The World Bank attributed the naira’s relative stability partly to Nigeria’s position as a major crude oil exporter. Higher global oil prices boosted export earnings and foreign exchange inflows into oil-producing economies, including Nigeria and Angola, cushioning their currencies against external pressures. This factor helped Nigeria maintain a stronger currency.
By August 2026, the naira had recovered 1.9% from its March-to-June lows, placing Nigeria among countries whose currencies regained ground following the initial market turbulence. The recovery indicates a positive trend for the naira. The World Bank’s report also noted that countries heavily dependent on imported petroleum products experienced greater financial strain as energy costs increased.
The bank identified rising demand for dollars, capital outflows, and concerns over foreign debt servicing as additional factors behind currency depreciation across African markets. These factors contributed to the varying degrees of currency fluctuations across the continent. The World Bank’s analysis highlights the complexities of African currency markets.
The World Bank raised Nigeria’s economic growth forecast to 4.3% in 2026, compared with an estimated 4% expansion in 2025. It projected further growth of 4.4% in both 2027 and 2028, citing improved macroeconomic stability, stronger investor confidence, and a gradual recovery in private investment. Nigeria's economic outlook appears positive.
Despite the encouraging outlook, the bank warned that Nigeria remained vulnerable to global financial instability, prolonged geopolitical tensions, insecurity, climate-related disruptions, and fluctuations in crude oil production. The World Bank urged Nigeria to sustain economic reforms, strengthen fiscal discipline, and build adequate policy buffers to protect recent macroeconomic gains.
Key points
- The naira depreciated by a maximum of 2.6% between March and June 2026.
- Ghana’s cedi recorded the steepest decline among African currencies, losing up to 10%.
- The World Bank raised Nigeria’s economic growth forecast to 4.3% in 2026.
