Nigeria’s external reserves are on track to reach about $45 billion by the end of 2025, a development analysts believe will strengthen the Central Bank of Nigeria’s (CBN) capacity to provide a solid buffer for the foreign exchange market and the broader economy.
The projection comes on the back of recent gains in the reserves, which rose to $41 billion last Tuesday, marking the highest level in 44 months, according to CBN data. This milestone represents a significant rebound after earlier depletion triggered by external debt repayments.
Throughout August, the reserves maintained an upward trajectory, climbing by $1.56 billion from $39.54 billion on August 1 to $41.11 billion by August 22. This growth amounts to a 3.95 percent increase within less than a month, underscoring the steady improvement in Nigeria’s external financial position.
Analysts at Cowry Assets Management, in their weekly market review, noted that the momentum of growth appears sustainable. They attributed this to a combination of steady offshore inflows and prospective external borrowings planned by the federal government. Such inflows, they argued, will likely support the CBN’s reserve buildup strategy through the rest of the year.
Similarly, experts at Meristem Securities projected that the reserves are well-positioned to remain above the $40 billion threshold, provided current positive trends continue. According to them, the stronger reserve position will not only enhance the CBN’s ability to stabilize the naira but also help bolster investor confidence and ensure external balance.
They added that with oil receipts recovering, portfolio inflows strengthening, and non-oil exports gaining momentum, Nigeria’s external reserves have a strong chance of sustaining their current upward path in the near term. This, they said, would provide a firmer platform for exchange rate management and broader macroeconomic stability.
Market watchers also emphasized the role of the CBN’s intervention in the foreign exchange market in keeping the naira relatively stable. Analysts at AIICO Capital highlighted that liquidity constraints were evident earlier in the past week due to the absence of CBN’s interventions. However, subsequent interventions worth about $50 million, combined with inflows from a local oil company, helped ease pressure in the market.
By the close of the week, trades had stabilized within the band of ₦1,534.50–₦1,536.00 per dollar, with the naira recording a marginal weekly depreciation of 16 basis points, closing at ₦1,535.04/$. On Monday, the naira closed slightly weaker at ₦1,536.42/$, representing a 0.09 percent drop from the previous session.
Overall, analysts agree that Nigeria’s external reserve growth signals improved macroeconomic stability, supported by a mix of rising oil revenues, stronger non-oil exports, and portfolio inflows. If the current momentum continues, the country’s reserves could cross the $45 billion mark by year-end, reinforcing the CBN’s capacity to manage the FX market and stabilize the domestic currency.
