Nigeria’s Foreign Reserves Hit 5-Month Low, Depreciates By $1.38 Billion As Naira Remains Stagnant

• Nigeria’s foreign exchange reserves have hit a five-month low, depleted by $138 billion as of February 5, 2025
• The current balance of the reserves stands at $39.440 billion, the same figure as the October 25, 2024 figure
• The development comes amid the rise in the naira’s value in the parallel segment of the FX market

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

Nigeria’s foreign exchange reserves have declined by $1.38 billion since January, reaching $39.497 billion as of February 5, 2025.

The reserves currently stand at $39.440, the last figure as of October 25, 2024.

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CBN data shows Nigeria’s FX reserves balance

Data from the Central Bank of Nigeria (CBN) show Nigeria’s FX reserves closed in 2024 at $40.877 billion.

In 2024, Nigeria raised $3.8 billion in debt, $900 million in domestic bonds, $2.2 billion in Eurobond and $750 million in a $2.2 billion World Bank loan.

While Nigeria’s gross foreign currency assets are depreciating, the local currency has risen in value.

According to CardinalStone’s forecast, Nigeria faces some debt obligations as the country has Eurobond maturities of about $1.33 billion per year over the next decade,

The cost includes coupon payments and total annual debt servicing costs averaging $2.24 billion.

The naira appreciates in black market

The development follows the rise in the naira’s value in the parallel market on Thursday, February 6, 2025, after the CBN issued new orders on dollar purchases by Bureau de Change (BDC) operators.

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The naira’s value increased by $15 per dollar as the dollar sold for N1,570, representing a 0.95% gain from the N1,585 quoted on the parallel market.

Black market traders said that dealers currently have ample supplies to meet market demands.

CBN authorises FX sales to BDCs

Legit.ng reported that the CBN gave new directives, allowing authorised dealer banks to sell FX to BDCs at a weekly cap of $25,000.

The new guideline aims to boost tracking and transparency and curb money laundering efforts in the FX markets operated by BDCs.

CBN disclosed that forex cash purchased by BDCs from dealer banks should be sold to end-users at a rate not exceeding one per cent above the buying rate.

The naira closes negatively in official market

Legit.ng earlier reported that the naira is reversing its gains against the US dollar after a week-long appreciation in the final week of January.

The Nigerian currency opened trading negatively in February after a massive bullish run in January when the CBN implemented a raft of reforms to stabilise it.

Experts lauded the naira's gains due to CBN’s policies, such as the launch of the FX Code to boost liquidity and transparency.