Nigeria’s net FX reserves hit $23bn, highest in 3yrs - Daily Trust (2025)

The improvement marked an increase from $3.99 billion at year-end 2023, $8.19 billion in 2022, and $14.59 billion in 2021.

This reflects a substantial improvement in the country’s external liquidity, reduced short-term obligations and renewed investor confidence.

NFER, which adjusts gross reserves to account for near-term liabilities such as FX swaps and forward contracts, is widely regarded as a more accurate indicator of the foreign exchange buffers available to meet immediate external obligations.

The data further showed that gross external reserves also increased to $40.19 billion, compared to $33.22 billion at the close of 2023.

The increase in reserves reflects a combination of strategic measures undertaken by the CBN, including a deliberate and substantial reduction in short-term foreign exchange liabilities—notably swaps and forward obligations.

According to the CBN, the strengthening was also spurred by policy actions to rebuild confidence in the FX market and increase reserve buffers, along with recent improved foreign exchange inflows—particularly from non-oil sources.

Reacting to the development, the apex bank governor, Olayemi Cardoso, said the improvement in NFER is not accidental but the result of deliberate policies by the bank.

“This improvement in our net reserves is not accidental; it is the outcome of deliberate policy choices aimed at rebuilding confidence, reducing vulnerabilities, and laying the foundation for long-term stability.

“We remain focused on sustaining this progress through transparency, discipline and market-driven reforms,” he stated.

Daily Trust had reported how Nigeria’s foreign reserves depreciated by $2.55 billion in the first quarter (Q1) of 2025.

According to data obtained from the CBN, the foreign reserves declined by 6.23 per cent from $40.88 billion to $38.33

Analysis further showed that the decline is the highest in the first quarters of the last five years.

In Q1 2024, the foreign reserves declined by $810.66 million (2.45 per cent); in Q1 2023, it dropped by $1.57 billion (4.24 per cent); during the same quarter the next year, the external reserves depreciated by $971.35 million (2.39 per cent); and in Q1 2022, the foreign reserves dwindled by $827.34 million (2.32 per cent).

However, with the current development, foreign reserve has now increased to N40.19 trillion.

The increase is attributed to the fact that “The bank significantly reduced its exposure to short-term foreign exchange obligations, such as swaps and forwards, which previously posed risks to liquidity.

“Also, a boost in foreign exchange inflows from non-oil sectors also strengthened the reserve position just as the CBN implemented policy measures aimed at restoring trust in the FX market, which helped attract more sustainable and stable inflows,” it stated.