Cardinal Stone projects stronger Naira at N1,350–N1,450/$ in 2026  

Cardinal Stone has projected that the Naira could strengthen to between N1,350 and N1,450 per dollar in 2026, driven by improving macroeconomic fundamentals and a more supportive foreign exchange environment.

CardinalStone Partners’ in its 2026 economic outlook report, “Indicators Align for Sustained Macro Gains,” published on January 6, 2026 outlines expectations of currency appreciation, easing inflationary pressures, and softer domestic energy prices, even as risks from global oil markets and domestic insecurity persist.

CardinalStone said it expects the Naira to appreciate in 2026 as policy reforms, improved FX liquidity, and moderating inflation combine to stabilise the currency.

“We expect Naira to appreciate to a range of N1,350.00/$ – N1,450.00/$ in 2026, supported by improving fundamentals,” the report stated.

Despite projecting a weaker global crude oil market due to oversupply and subdued demand, the firm believes Nigeria’s foreign exchange outlook could remain resilient.

“Elsewhere, due to oversupply and weaker demand, crude oil prices are likely to be lower,” the report read. Lower oil prices typically pressure Nigeria’s FX earnings, but CardinalStone argues that structural improvements in the FX market could help cushion the impact.

The report also projects that declining crude oil prices, combined with a stronger Naira, could lead to lower domestic energy costs in 2026. Prices of Automotive Gas Oil (AGO) and Premium Motor Spirit (PMS) are expected to ease further.

“The weak oil price, coupled with an improving FX outlook, should further drive down the domestic prices of AGO and PMS,” the report noted.

In addition, CardinalStone highlighted increased competition in Nigeria’s downstream petroleum sector, particularly between local refineries and fuel importers, as a positive development for energy price stability.

“More so, competition in the domestic market between local refineries and importers bodes well for the local energy price outlook,” the report said.

On inflation, CardinalStone projects a gradual moderation in 2026, although it flagged rising insecurity—especially in food-producing regions—as a key downside risk.

“Nonetheless, we note the increased traction of insecurity as a risk factor, especially in food-producing regions, which could limit food supply,” the firm warned.

Taking these factors into account, alongside expected pre-election year spending, CardinalStone forecasts that headline inflation will ease to an average of 15.5% in 2026, before closing the year at 13.9%.

A stronger naira and easing inflation could help stabilise purchasing power, reduce imported inflation, and support broader macroeconomic recovery in 2026. Lower energy prices would also ease cost pressures on households and businesses, particularly in transport and manufacturing.

However, the outlook remains sensitive to security challenges and global oil market dynamics, underscoring the need for sustained reforms and improved domestic stability.