Nigeria’s foreign exchange (FX) reserves declined by $263 million, snapping a 25-week run of steady accretion, latest data from the Central Bank of Nigeria (CBN) showed.
The reserves fell to about $XX.XX billion at the close of the week, compared with $XX.XX billion recorded in the previous week, marking the first weekly drop after nearly six months of sustained build-up driven by improved FX inflows and tighter demand management.
Market analysts attributed the decline to increased FX interventions by the apex bank to stabilise the naira, as well as higher demand for foreign currency to meet import obligations and other external payments. The moderation also coincided with continued volatility in global oil prices, Nigeria’s main source of FX earnings.
Despite the setback, the CBN has maintained that the overall reserves position remains adequate to support the naira and meet short-term external obligations. The bank has, in recent months, stepped up reforms in the FX market, including clearing outstanding FX backlogs and boosting transparency, moves that had helped shore up investor confidence and support reserve accretion.
Analysts noted that while the latest decline warrants monitoring, it does not yet signal a reversal of the broader improving trend seen in recent months. They expect reserves to remain relatively stable in the near term, supported by crude oil receipts, diaspora remittances and anticipated foreign portfolio inflows, provided global conditions remain benign.
Nigeria’s FX reserves are closely watched by investors and rating agencies as a key indicator of the country’s external buffers and its ability to manage currency pressures.
