The Nigerian naira continued its downward trend against the US dollar on Monday, even as the country’s foreign exchange reserves climbed to their highest level in six years — $42 billion.

Market reports show that demand pressure in the foreign exchange market has persisted, weakening the naira despite the Central Bank of Nigeria (CBN) boasting stronger reserves. Traders noted that increased speculative activities and unmet demand from importers continue to drive the naira’s depreciation.

Analysts say the reserves milestone signals a stronger buffer for the CBN to defend the local currency, but they caution that without structural reforms and improved dollar inflows from exports, the pressure on the naira will remain.

The development comes amid concerns about inflation, rising import costs, and the impact of naira weakness on businesses and households.