CBN FX Sales Hit $654m in December as Nigeria’s Foreign Exchange Inflows Rebound
Foreign exchange inflows into Nigeria’s FX market rebounded sharply in December, supported largely by increased dollar sales from the Central Bank of Nigeria (CBN), according to data released by FMDQ. Total FX inflows rose by 38 per cent month-on-month to $2.8 billion, recovering from a steep 67 per cent contraction recorded in November, though supply levels remained among the weakest seen in the past 16 months.
The rebound was driven primarily by stronger intervention from the CBN, which sold $654 million into the market in December—more than double the amount recorded in the previous month. The aggressive support highlighted the apex bank’s growing role in sustaining liquidity at a time when offshore investor participation remained muted toward the close of 2025.
Despite the overall improvement, not all segments recorded gains. FX inflows from domestic corporates fell by 5 per cent month-on-month to $420 million, making it the only segment to contract during the period. However, inflows from exporters and importers rose by 49 per cent to $683 million, while contributions from individuals surged by 88 per cent to $275.3 million, reflecting stronger activity across non-offshore sources.
Foreign portfolio inflows edged up modestly by 7 per cent to $632 million in December, a sharp slowdown compared with the $3.5 billion recorded in October. Market participants attributed the softer performance to typical year-end patterns, as global investors reduced deployable liquidity, locked in profits, and rebalanced portfolios. Foreign direct investment, though still limited, more than doubled to $50.1 million from $10.4 million in November, signalling cautious long-term interest.
Analysts expect foreign participation to improve in the months ahead, supported by Nigeria’s relatively high yields and easing policy uncertainty. FBNQuest Merchant Bank noted that softer inflation expectations could allow for a more accommodative policy stance in 2026, while a potentially dovish U.S. Federal Reserve may improve global risk appetite. For now, however, December’s data underscore the FX market’s continued reliance on central bank intervention, even as broader inflows show early signs of stabilization.
source: The Sun