CBN Set to Unveil Revised FX Manual to Boost Market Confidence, Strengthen Naira

·      Transactions on NGX rise to N11.9tn, highest in 20 years

Kayode Tokede

The Central Bank of Nigeria (CBN) is set to roll out a revised foreign exchange (FX) manual in the first of 2026, a move it has said would strengthen the naira, reduce volatility, and enhance confidence in the nation’s currency.

The apex bank said the initiative forms part of broader efforts to overhaul the framework governing forex transactions and improve confidence in the FX regime.

This emerged as the Nigerian Exchange Limited (NGX), yesterday, disclosed that domestic and foreign investors’ total transactions increased significantly to N11.9 trillion in 2025, making it the highest growth figures since 2007.

Speaking on the reforms of the FX manual at a forum, the Deputy Governor, Economic Policy, CBN, Dr. Muhammad Sani Abdullahi, disclosed that the bank was undertaking a comprehensive revamp of the forex manual, a key regulatory document used by banks for export proceeds and other foreign trade-related transactions.

According to him, the document was already undergoing significant reforms aimed at aligning market operations with current economic realities.

Abdullahi explained that the revised manual would introduce clearer rules, stronger oversight and improved processes to support transparency and efficiency in the FX market.

He said the reforms are expected to close loopholes, reduce uncertainty for market participants, and support a more orderly functioning of the foreign exchange system.

“One of the things we are working on for this year is a complete revamp of the framework that governs forex transactions in Nigeria. The forex manual is the document that banks hold for exports and other things that are related to foreign trade.

“It is already undergoing a significant amount of reforms, and we should be done in the next one or two months, which will change and improve the value of the naira, and we shall continue to see less volatility,” Abdullahi said.

Meanwhile, the NGX, yesterday, disclosed that domestic and foreign investors’ total transactions increased significantly to N11.9 trillion in 2025, making it the highest growth figures since 2007.

This was about a 113.4 per cent increase over N5.59 trillion declared by the bourse in its “Domestic & Foreign Portfolio Investment Report of Nigerian Exchange Limited.”

The N11.9 trillion milestone growth was on the backdrop of CBN’s reforms in the FX market that has led to massive Foreign Portfolio Investment inflow into the stock market last year.

The reforms were part of the CBN’s broader strategy to create a fairer, more stable FX market and support economic growth through better monetary policies.

The N11.9 trillion transactions contributed to the N36.6 trillion market capitalisation investors average returns in 2025, while the NGX All-Share Index appreciated by 51.2 per cent.

Analysts attributed the upbeat in the stock market last year to the increasing attractiveness of the Nigerian market to foreign investors, ongoing economic reforms, resilient earnings by Nigerian companies, exchange rate differential, ongoing banking recapitalisation and the reform in the oil sector.

According to the report, the foreign investors’ transactions closed 2025 at N2.65 trillion, a growth of 210.7 per cent from N852 billion in 2024, while domestic investors’ transactions moved from N4.73 trillion in 2024 to N9.27 trillion in 2025, representing an increase of nearly 96 per cent.

The report also revealed that foreign investors’ contribution to the N11.9 trillion stood at 22.21per cent in 2025 from 15.25per cent in 2024, making it the highest since 2007.

Also, domestic investors contributed 77.79 per cent in 2025 from 84.75per cent in 2028 amid increasing foreign investors’ soaring participation in the Nigerian stock market.

According to the report, the foreign investors inflow outgrew outflow in 2025 amid the stock market’s more growing fundamentals and impressive corporate earnings by listed companies. It showed that foreign investors’ inflow stood at N1.4 trillion in 2025 from N396 billion in 2024, while outflow closed 2025 at N1.24 trillion from N455.62 billion in 2024.

However, the report disclosed further that domestic retail transactions were at N3.65 trillion in 2025 from N2.31 trillion, while domestic institutional transactions closed 2025 at N5.62trillion from NN2.43trillion in 2024.

The report by NGX noted that over 19 years, domestic transactions increased by 160.82percent from N3.556 trillion in 2007 to N9.27 trillion in 2025, whilst foreign transactions also increased by 329.87per cent from N0.6156 trillion to  N2.65 trillion over the same period.

“Total domestic transactions accounted for about 78per cent of the total transactions carried out in 2025, whilst foreign transactions accounted for about 22per cent of the total transactions in the same period.

“Total market transactions increased significantly year-on-year, rising from N5.587 trillion in 2024 to N11.9222 trillion in 2025. This reflects an increase of N6.3352 trillion, representing a growth of about 113.39per cent,” the report stated.

The Vice President, Highcap Securities Limited, Mr. David Adnori, in a chat with THISDAY, attributed the growth in foreign investors’ participation to the federal government’s efforts in resolving FX backlogs, arguing that it helped in increasing investors’ confidence and sustained rally in the stock market.

Analysts at Coronation, in a report, stated that fuel subsidy removal, liberalisation of the forex market, and monetary policy tightening reforms by the present administration played a pivotal role in turning the tide.