Nigeria’s foreign exchange reserves rose to $41 billion on Tuesday, their highest level in 44 months, according to figures released by the Central Bank of Nigeria (CBN).
The reserves are now sufficient to cover around 10 months of imports, marking a major turnaround for the economy after years of pressure from debt servicing and external vulnerabilities. The last time reserves stood at this level was on 3 December 2021.
Analysts attribute the rebound to improved foreign exchange inflows, stronger oil earnings, lower import demand, and recent government-led reforms. The increase also bolsters the CBN’s ability to stabilise the naira, manage liquidity, and ward off speculative attacks.
The apex bank has projected plans to keep growing reserves towards at least $100 billion, a target it says will strengthen economic resilience and dispel concerns about fragility in Nigeria’s external accounts.
CBN data shows reserves gained $1.46 billion this month alone, climbing from $39.54 billion on 1 August to $41 billion on 19 August—a 3.69 per cent rise in under three weeks, averaging $81 million daily. The momentum began when reserves crossed the $40 billion mark on 7 August, rising to $40.5 billion by 12 August before surpassing $41 billion a week later.
This consistent accretion indicates that inflows are outpacing outflows, a positive signal for investor confidence. Coupled with falling inflation and softer global commodity prices, it suggests ongoing reforms are beginning to yield tangible results.
On a year-to-date basis, the growth is more modest. Reserves closed 2024 at $40.88 billion, meaning the latest figure represents a net increase of just $124 million, or 0.30 per cent, since January. The bulk of the gains have occurred over the past five weeks, following a sluggish first half of 2025 when reserves fluctuated between $37 billion and $39 billion. Since July, however, reserves have jumped by more than $3 billion, an 8 per cent surge in little over a month.
At $41 billion, Nigeria’s reserves are now at their strongest since late 2021, reversing the declines of 2022 and 2023 when they hovered just above $38 billion under heavy exchange rate pressures.
CBN Governor Olayemi Cardoso, speaking at the July Monetary Policy Committee (MPC) meeting, attributed the improvement to higher capital inflows, stronger crude oil output, rising non-oil exports, and reduced imports. He noted that international investors are showing renewed interest in Nigeria’s financial system, underpinned by reforms and regulatory assurances.
“The key thing is that we, as regulators, will continue to ensure resilience in the system and maintain transparency, because trust is critical for those investing in Nigeria,” Cardoso said.
Economists argue that stronger external buffers will enhance Nigeria’s sovereign credit outlook, boost investor confidence in the government’s ability to meet obligations, and give the CBN greater flexibility to manage liquidity shocks.
With reserves strengthening, inflation easing, and relative currency stability, analysts believe both businesses and households could benefit from an improved macroeconomic environment. They add that sustaining reforms and keeping external inflows steady will be crucial to consolidating the gains.
