Nigeria’s external reserves fall to $55.09bn, first drop in three months

Nigeria’s foreign exchange reserves have fallen to $55.09 billion, the first decline in three months, according to Central Bank of Nigeria data. The reserves dropped from $55.1 billion on October 13, a decrease of about $10 million.

The last recorded decline before the latest dip was on July 28, when reserves stood at $51.94 billion. The external reserves fluctuated in late July before a gradual recovery began in August.

How the reserves moved

CBN data showed reserves at $52.03 billion on July 21. They rose marginally to $52.04 billion the next day, then declined to $51.94 billion on July 28. By July 30, they had fallen further to $51.92 billion.

Recovery started in August. Reserves rose to $51.94 billion on August 3, $52 billion on August 5 and $52.14 billion on August 10. They later climbed to $55.1 billion on October 13.

Despite the latest decline, reserves remain about $3.15 billion higher than the $51.94 billion recorded on July 28.

Why reserves matter

Nigeria’s external reserves serve as a buffer against external economic shocks. They help the CBN meet international payment obligations and support foreign exchange market stability. Reserve levels are also watched as an indicator of the country’s capacity to meet external obligations and withstand pressure on the naira.

A single day’s marginal decline does not necessarily indicate a sustained deterioration in the external position. The reserve trajectory comes amid CBN efforts to reform the foreign exchange market, improve liquidity and strengthen confidence in the naira.

Fitch forecast

In April, Fitch Ratings projected that Nigeria’s foreign exchange reserves could decline to $47 billion by the end of 2026. The forecast also highlighted the difference between the headline level of gross external reserves and the longer-term sustainability of those reserves.

The projection suggests the recent increase in reserves may not be sustained throughout the year, depending on foreign exchange inflows, external payments and other pressures on the country’s balance of payments.

For businesses and consumers, reserve movements matter because they shape the CBN’s ability to support the naira and meet import and payment needs.