Kayode Tokede
Analysts at Coronation Research has projected the Naira to trade at N1,400 against the dollar in the second half (H2) of 2026, stressing that the local currency will witness gradual depreciation by year-end.
The Head, Coronation Research, Macrorearch, Adeyemi Temilola made the projection in a presentation at the first half (H1) 2026 Capital Market Review and Outlook for H2 2026 held in Lagos.
In her presentation, she revealed that the naira in the H1 2026 beats the company’s N1,382 against the dollar forecast to eventually close at an average N1,365 against the dollar.
She revealed that global economy growth, inflation and crude oil prices are external backdrop shaping H2 2026.
“The principal deviations — a more cautious MPC and a stronger naira — both stemmed from the same source: Nigeria’s improved yield differential attracted record portfolio inflows ($10.37billion in Q1, +83.8per cent y/y), giving the CBN room to prioritise credibility over speed while still delivering currency stability,” she explained.
She stated that the naira outperformed in H1 2026 over sustained foreign portfolio inflows into Open Market Operation (OMO) bills and fixed-income securities on attractive real yields, improved foreign exchange liquidity and continued Central lBank of Nigeria (CBN) interventions and elevated crude prices from the Hormuz shock offset weaker production volumes.
She noted that the 96 per cent growth in the non-oil sector’s fiscal and foreign exchange position still leans on oil prices.
“Our base case assumes Brent stabilises below $80/bbl as the peace memorandum holds. If that normalises the price windfall while domestic crude output stays soft, the combined effect would pressure fiscal and foreign exchange suffers even as headline GDP keeps expanding,”she said.
Temilola highlighted six swing factors that will shape H2 2026 in which part of them include: full reopening vs. renewed escalation — the single biggest swing factor for oil revenue, foreign exchange and reserve; S&P upgraded Nigeria to B in May; whether Fitch/Moody’s follow hinges on fiscal and FAB/TRS transparency and 26.50 per cent Monetary Policy Rate (MPR) balances carry-trade inflows against mounting real-sector credit strain.
On where there is opportunities, she said fixed income elevated stop rates (18.3per cent+ on long bonds) offer attractive entry points for investors able to lock in duration ahead of an eventual easing cycle.
“Front-end / short-duration instruments remain the more defensive stance while sovereign supply stays heavy through Q3 Watch the Q3 N8.60 trillion issuance calendar for the best entry windows,”she said.
She noted that naira stability through H1 2026 supports import dependent and naira-denominated positioning, but the H2 drift toward N1,400 against the dollar argues for hedged foreign exchange exposure into the fourth quarter (Q4) of 2026.
“Non-oil resilience (96.08per cent of GDP) favours ICT, trade, agriculture and select industrial names over oil-linked plays. High-for-longer rates remain a headwind for credit-intensive sectors and private investment recovery, she said on opportunity in the real economy & equities.