Non-Bank Corporates Drive 24% Surge in Nigeria’s FX Inflows as Dollar Bond Hits 180% Subscription

Nigeria recorded a significant boost in foreign exchange inflows in July 2025, climbing 24% to $1.7 billion, driven largely by non-bank corporates, according to data from FMDQ. For the second consecutive week, these corporates outperformed foreign portfolio investors (FPIs), signaling stronger investor confidence in the country’s financial markets. This development coincides with the successful issuance of Nigeria’s first domestic dollar bond, which attracted an impressive 180% subscription rate.

Despite this shift, FPIs remained a key contributor, accounting for about 45% of total inflows during the period. Offshore investor interest was fueled by favorable carry trade opportunities and stable global macroeconomic conditions, leading to increased inflows from $1.5 billion in June to $1.7 billion in July. Analysts say this cautious optimism reflects foreign investors’ growing appetite for Nigerian assets following recent monetary and forex reforms.

The Central Bank of Nigeria (CBN) reported that the country’s foreign exchange reserves surged to $41.046 billion as of August 20, the highest level since December 2021. This recovery follows a series of reforms aimed at stabilizing the naira, clearing forex backlogs, and introducing the Nigerian Foreign Exchange Code to align with global best practices. Over $7 billion in verified forex forwards has already been settled as part of efforts to restore market confidence.

CBN Governor Olayemi Cardoso reaffirmed the apex bank’s commitment to maintaining stability through continued policy adjustments. “We have acted as a catalyst to ensure these reforms take root. The data shows progress is being made,” Cardoso said at the latest Monetary Policy Committee meeting. Market analysts predict further reserve growth and reduced volatility as the unification of exchange rates takes effect.

Meanwhile, global currency markets remain focused on U.S. Federal Reserve policy signals ahead of Chairman Jerome Powell’s speech at the Jackson Hole symposium. The U.S. Dollar Index (DXY) hovered around 98.65 as traders scaled back expectations for an imminent rate cut. While manufacturing growth data suggests economic resilience, uncertainty around inflation trends and Fed policy continues to influence forex markets worldwide—factors that could shape Nigeria’s inflow trajectory in the coming months.

Source: Nairametrics