Nigeria’s Foreign Reserves Projected to Reach $41bn by Year-End Amid Naira Gains

Nigeria’s external reserves could reach $41 billion by the end of 2025, driven by the continued appreciation of the naira against the US dollar and an uptick in foreign exchange inflows. This optimistic projection was revealed by economic analysts who cited stronger macroeconomic indicators and monetary policy tightening as key contributing factors.

According to financial experts, the Central Bank of Nigeria’s (CBN) reforms—particularly those targeting foreign exchange unification and increased interest rates—have improved investor confidence. This, in turn, has encouraged higher FX inflows into the country, further supporting the naira and boosting the nation’s reserve levels.

The naira has gained momentum in recent months due to aggressive rate hikes, which have helped reduce excess liquidity and curb speculative FX demand. These actions have also attracted foreign portfolio investments, strengthening the currency and creating a more stable financial environment for trade and investment.

Analysts believe that if these trends persist—especially the steady inflow of foreign capital and the CBN’s policy consistency—the reserves could surpass current estimates. They emphasized the importance of maintaining macroeconomic stability to ensure that these gains are not reversed.

While the outlook remains positive, experts warn that global market volatility, geopolitical risks, or a sudden drop in oil prices could derail the reserve growth trajectory. Therefore, maintaining fiscal discipline and implementing structural reforms will be essential to sustaining Nigeria’s economic recovery and long-term stability.

Source: Leadership