Naira Falls, NGX Loses ₦2.8 Trillion Stock As Trump’s Threat Rattle Investors

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Nigeria’s financial markets have been thrown into turmoil following the decision by U.S. President Donald Trump to classify the country as a “Country of Particular Concern” (CPC) — a move accompanied by remarks suggesting potential military intervention.

Since the announcement, both the Nigerian Exchange Limited (NGX) and the naira have recorded sharp declines, reflecting shaken investor confidence and heightened geopolitical anxiety.

According to data monitored by Naija News, the NGX, which had already shed about ₦2.8 trillion in market value last week, continued its downward slide on Monday, while the naira depreciated further to ₦1,437.29/$ at the official window and weakened across parallel markets.

Market Reaction and Investor Anxiety

Financial experts say the reaction was predictable, as global investors often respond swiftly to political risk signals from major world powers.

Former President of the Chartered Institute of Bankers of Nigeria (CIBN), Mazi Okechukwu Unegbu, told Daily Post that Trump’s statements created uncertainty that led to capital flight, sell-offs, and the suspension of new investments.

“The psychological effect alone was enough to trigger sell-offs and halt new inflows. Investors do not wait for details when such high-level comments are made,” Unegbu said.

He added that while the panic spread across multiple sectors, he doubted that the U.S. would actually carry out any form of military action, describing the market’s overreaction as a sign of Nigeria’s fragile economic fundamentals.

Unegbu also noted that recent foreign exchange gains were “artificial,” stressing that meaningful recovery would require increased local production, especially in agriculture and manufacturing.

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‘Fear of Sanctions and Capital Flight Drove the Plunge’ — Oyedokun

In his assessment, Professor Godwin Oyedokun, an economist and university lecturer, said the combined crash of equities and the naira reflects deep-seated fear of sanctions and strained diplomatic relations.

“The CPC label sends a strong signal to the global financial system. Investors fear that such designation may lead to travel bans, restricted financial access, or reduced cooperation,” he said.

Oyedokun explained that the depreciation of the naira also reflected a rush by Nigerians to buy and hoard dollars, a behaviour he warned could worsen volatility and prolong instability.

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‘Avoid Panic; Nigeria Must Respond Strategically’

While acknowledging the severity of the situation, Oyedokun urged restraint and strategic diplomacy rather than emotional financial reactions.

“Confidence is the backbone of any market. What Nigeria needs now is a clear, calm, and coordinated response,” he advised.

He urged the federal government to immediately engage U.S. diplomats to clarify the circumstances surrounding the CPC listing and communicate transparently with investors to rebuild trust.

Oyedokun also called for closer coordination between the Central Bank of Nigeria (CBN) and fiscal authorities to stabilise the naira, protect capital markets, and signal long-term policy consistency.

He emphasised that the episode underscores Nigeria’s overreliance on foreign markets and the urgent need to diversify the economy, boost exports, and strengthen governance and security institutions.

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Analysts Warn of Extended Volatility

Market watchers say the coming days will be critical as investors monitor the government’s diplomatic and policy response.

Without decisive intervention, analysts warn that the turbulence could persist longer than anticipated, deepening existing pressures on the naira and equities.

For now, Trump’s remarks have exposed Nigeria’s vulnerability to external shocks, reinforcing calls for structural economic reforms, stronger institutions, and improved international relations.