Nigeria’s foreign exchange reserves have surged to $42.03 billion, reaching their highest level in six years and offering a major boost to the country’s financial stability.
According to the latest figures released by the Central Bank of Nigeria (CBN) on Monday, the reserves hit the 72-month peak following a combination of improved crude oil earnings, stronger remittance inflows, and increased foreign investment. The figure represents a sharp rise compared to recent years, when external buffers were strained by oil production challenges, pandemic-induced shocks, and persistent demand pressures on the naira.
Analysts say the surge will strengthen Nigeria’s ability to defend its currency, service external debt, and reassure investors about the resilience of its balance of payments. “Crossing the $42 billion mark is significant for Nigeria, particularly at a time when exchange rate volatility has been a pressing concern,” said one Lagos-based financial analyst.
The CBN attributed the gains largely to rising global oil prices and improved production levels after months of disruptions caused by theft, pipeline vandalism, and underinvestment in the sector. With oil accounting for more than 80 percent of Nigeria’s foreign exchange earnings, the rebound has translated into stronger fiscal buffers for the government.
Beyond oil, increased diaspora remittances and capital inflows have also played a role in the reserves build-up. The apex bank noted that reforms aimed at stabilizing the foreign exchange market and improving investor confidence have begun to yield results.
Economists, however, cautioned that sustaining the momentum will depend on Nigeria’s ability to diversify its sources of foreign exchange, curb inflationary pressures, and manage capital outflows. They also warned that heavy reliance on oil revenues continues to pose long-term risks, especially in a global market increasingly shifting toward renewable energy.
Still, the reserves milestone has been widely welcomed by policymakers and market watchers, who see it as a sign of improving economic fundamentals and a potential cushion against external shocks.
