FX Reserves
Iyunade Grace
Nigeria’s foreign exchange reserves have hit an eight-year high of $46.7 billion, providing over 10 months of import cover. This milestone reflects improved macroeconomic stability, increased investor confidence, and sustained inflows.
The Central Bank of Nigeria (CBN) attributes the growth to improved oil receipts, stronger balance of payments, and renewed foreign portfolio inflows. The CBN Governor, Yemi Cardoso, noted that this accretion reflects investor confidence in Nigeria’s policies.
The reserves surge is also linked to the government’s Eurobond issuance and increased foreign exchange inflows. October 2025 marked the country’s strongest month for FX inflows since May, driven by enhanced macroeconomic stability and renewed interest from offshore investors.
The CBN’s efforts to stabilize the foreign exchange market and attract investments have contributed to this growth. With stronger reserves, the CBN has greater flexibility to intervene in the FX market, supporting the naira’s stability.
The naira has shown signs of stabilization, with the gap between official and parallel market rates narrowing to below 2%. This stability has restored investor confidence and reduced uncertainty for households and firms.
Inflation has moderated significantly, easing to 16.05% in October 2025 from a peak of 34.6% in November 2024. Core inflation has also begun to soften, suggesting the cumulative impact of tight policy settings is transmitting through the economy.
The CBN’s Monetary Policy Department has played a crucial role in this achievement, providing robust technical support and research to inform policy decisions. The department is transitioning to a full inflation-targeting regime, aiming to anchor expectations and sustain price stability
