Big Win for Naira as External Reserves Cross $45bn, First Time Since 2019
- There is hope for the Nigerian economy and currency following the rebound of the country’s external reserves
- Recent Central Bank of Nigeria (CBN) data shows that the external reserves reserves have climbed pass $45 billion
- The development is a major feat for the country, which experienced such accretion six years ago
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
Nigeria’s external reserves have climbed to $45.04 billion, their strongest point since July 23, 2019.
The latest update from the Central Bank of Nigeria shows a steady improvement in the country’s foreign asset position, with nearly $5 billion added in just a few months.
That growth stands out at a time when several developing economies are struggling to protect their FX buffers.
Source: Getty Images
Why this level matters for the naira
Analysts say the consistent buildup signals stronger inflows supported by improved crude oil earnings, Eurobond-related receipts and multilateral financing.
The CBN now holds more room to defend the naira whenever FX volatility resurfaces.
A reserve position above $45 billion is more than a symbolic threshold. It has a direct impact on sentiment in the foreign exchange market.
Higher reserves give the apex bank more room to smooth out market pressures, especially during periods of heightened dollar demand.
Foreign portfolio investors also track reserve levels closely. A buffer above $45 billion sends a message that Nigeria is better prepared to meet external obligations, finance imports and manage sudden shocks.
This sort of confidence boost often attracts fresh inflows into equities and fixed-income markets.
Consistent growth shows real improvement
The upward path has been clear for weeks. November opened at $43.26 billion and maintained stability above $43 billion throughout the month.
By November 18, reserves had crossed $44 billion. The month closed at $44.67 billion, one of the highest month-end figures in years.
December continued the same momentum, holding firm in the $44 billion range before crossing the crucial $45 billion mark on December 4.
The progression from $43 billion to $45 billion in roughly four weeks reflects healthier FX supply rather than a one-off jump.
Festive season pressure weighs on the naira
Even with rising reserves, the naira still faced renewed pressure last week, closing at 1,454 per dollar on Friday.
Seasonal demand ahead of Christmas and New Year celebrations has fuelled increased dollar purchases by importers and retailers.
That surge in demand continues to weigh on the currency in the short term.
Still, the stronger reserve position gives the CBN more breathing room to address temporary spikes in demand as the festive period peaks.
CBN tightens FX market oversight with new BDC licences
Alongside the reserve gains, the CBN has confirmed that 82 Bureaux de Change have received full operating licences under the revised 2024 guidelines.
The approvals, issued under the Banks and Other Financial Institutions Act, took effect on November 27.
The Bank reminded the public that only BDCs listed on its website are permitted to operate.
It warned that running a BDC without a valid licence remains a punishable offence.
Source: Getty Images
The updated framework is part of ongoing efforts to strengthen regulation, improve compliance and protect consumers.
By insisting on stricter standards and encouraging Nigerians to verify the authenticity of operators, the CBN hopes to reduce the risks associated with unregulated currency dealings and maintain a stable FX environment.
CBN releases new exchange rate
Legit.ng earlier reported that Nigeria’s foreign exchange market opened the week on a tense note as the naira weakened further despite a fresh $100 million intervention by the Central Bank.
The move, aimed at calming rising demand for dollars at the official window, did little to stop renewed pressure on the local currency.
According to the latest figures released by the CBN, the naira reached an intraday high of N1457 to the dollar at the Nigeria Foreign Exchange Market.
Source: Legit.ng
