The Nigerian naira and the Zambian kwacha could post further gains in the near term, supported by policy reforms, improving foreign exchange liquidity and easing external pressures, market analysts said.
In Nigeria, the naira has stabilized in recent weeks following tighter monetary policy, improved dollar supply from exporters and the central bank’s efforts to clear parts of its FX backlog. Analysts say continued reforms in the foreign exchange market, alongside elevated interest rates, could help sustain investor confidence and attract portfolio inflows.
“The combination of orthodox FX reforms and a tighter monetary stance is gradually restoring confidence,” one Lagos-based trader said, adding that sustained oil export receipts and remittances would be key to maintaining momentum.
In Zambia, the kwacha has benefited from stronger copper prices, expectations of increased mining output and continued engagement with international lenders. Progress on fiscal consolidation and debt restructuring has also helped to underpin sentiment toward the currency.
Economists show that Zambia’s external position could strengthen further if commodity exports remain robust and foreign inflows improve, easing pressure on reserves and supporting the local currency.
Despite the positive outlook, analysts cautioned that both currencies remain vulnerable to global risk sentiment, swings in commodity prices and potential shifts in U.S. monetary policy, which could trigger capital outflows from frontier markets.
Still, for now, Nigeria and Zambia stand out among African markets where policy clarity and improving fundamentals are offering room for further currency appreciation.
