Grey List: Naira Strengthens Against the U.S. Dollar

The Naira has reached a 10-month high, trading at ₦1,444.42 to the United States Dollar ($) in the official market.

The development comes following Nigeria’s removal from the Financial Action Task Force (FATF) grey list, a decision analysts say has triggered renewed investor confidence and stronger market inflows.

Data from the Nigerian Foreign Exchange Market (NFEM) released by the Central Bank of Nigeria (CBN) showed the local currency closed October at ₦1,422/$, while the parallel market rate appreciated to ₦1,465/$ as dollar holders rushed to offload their positions.

Market experts say the naira’s rally reflects the combined impact of CBN’s foreign exchange reforms, increased liquidity, and a renewed global perception of Nigeria’s financial integrity following its FATF delisting.

The FATF, a global watchdog supported by the World Bank and International Monetary Fund (IMF), removed Nigeria from its list of countries with high money-laundering and terrorist-financing risks on October 24, 2025, citing the country’s progress in meeting its 40 anti-financial crime recommendations.

President of the Association of Bureaux De Change Operators of Nigeria (ABCON), Dr. Aminu Gwadabe, said the FATF’s decision had significantly boosted market morale.

“The recent announcement of Nigeria’s exit from the FATF grey list has tremendously induced confidence and removed tension in the market,” Gwadabe said.

“The impacts are already reflecting plausibly as the naira appreciates against the dollar by ₦10/$.”

He added that Nigeria’s improved compliance record and financial reforms had created optimism for long-term stability in the foreign exchange market.

Reacting to the development, CBN Governor Olayemi Cardoso described the FATF’s decision as “a strong affirmation of Nigeria’s reform trajectory and the integrity of its financial system.”

“The FATF’s decision to remove Nigeria from the grey list is a strong affirmation of our reform trajectory and the growing integrity of our financial system,” Cardoso said.

“It reflects a clear policy direction and the coordinated efforts of national institutions working together to deliver sustainable, standards-based reforms. Our priority now is to consolidate these gains and ensure that compliance, innovation, and trust advance hand in hand.”

According to the CBN, the reform agenda is focused on deepening transparency, tightening anti-money laundering oversight, and aligning Nigeria’s practices with international standards to attract more investment inflows.

Since June 2023, the CBN’s exchange rate unification and FX reforms have helped reduce speculation, close the gap between official and parallel market rates, and rebuild confidence among investors.

The apex bank has injected liquidity into the retail forex segment, enforced tighter compliance with FX regulations, and maintained a more transparent trading platform through the 

Electronic Foreign Exchange Matching System (EFEMS).

The naira’s recent appreciation represents a ₦216.70 gain, about 15 per cent, compared to the ₦1,661.12/$ rate recorded in December 2024 when the EFEMS was introduced.