Nigeria’s External Reserves Hit $41bn, Highest Level in 44 Months
Nigeria’s foreign exchange reserves have recorded a significant rebound, rising to $41 billion as of August 19, 2025, the highest level in nearly four years.
This development marks a major milestone for Africa’s largest economy, which has battled reserve depletion and exchange rate volatility in recent years.
Latest figures from the Central Bank of Nigeria (CBN) show that the reserves climbed from $39.54 billion at the start of August to $41 billion within 19 days, reflecting a 3.69 percent growth in less than three weeks.
On average, this amounts to an inflow of about $81 million daily, underscoring the strong momentum that has characterized August’s performance.
The rally comes after months of strain. Earlier in the year, Nigeria’s reserves had dropped to the low $37 billion range, fueling concerns about the CBN’s ability to defend the naira and meet international obligations. However, between mid-July and mid-August alone, the reserves rose by more than $3 billion, representing an 8 percent monthly increase.
Despite this impressive recovery, the overall year-to-date movement has been relatively modest. On December 31, 2024, reserves stood at $40.88 billion, meaning the net gain in 2025 amounts to just $124 million. Analysts note, however, that the bulk of this growth has taken place in the last five weeks, suggesting a renewed inflow of foreign exchange into the economy.
Financial experts attribute the rebound to a mix of factors, including higher oil receipts, improved non-oil revenues, fresh capital inflows, and possible external borrowings.
The CBN, which has faced mounting pressure to stabilize the naira, is now armed with a stronger reserve position to manage market liquidity and counter speculative activities.
The strengthened reserves are expected to ease some of the pressure on the domestic currency, which has suffered fluctuations due to rising import demand, global oil price swings, and speculative trading in the foreign exchange market.
With a larger buffer, the apex bank is in a better position to safeguard the economy against external shocks while maintaining its capacity to service international obligations.
Nevertheless, economic analysts caution that the gains remain vulnerable to global oil market dynamics and capital flow reversals.
They stress the importance of diversifying foreign exchange sources, especially through non-oil exports and foreign direct investments, to ensure long-term sustainability.
For now, the reserves’ rise to a 44-month high is being viewed as a positive sign of resilience for Nigeria’s economy. The development offers a measure of relief for policymakers and investors alike, signaling that the country’s external position is strengthening at a time of heightened global economic uncertainty.
