Nigeria’s foreign exchange reserves have climbed to one of their strongest levels in years, reaching 46.7 billion dollars following a wave of renewed investor interest and proceeds from the recent Eurobond issuance.
This comes as the naira maintained a largely steady position across the official and parallel markets on Monday.
Figures released by the Central Bank of Nigeria show that the naira closed at 1,448.03 per dollar at the official market, only slightly weaker than the 1,442.43 recorded last Friday.
On the parallel market, the currency appreciated marginally, selling at 1,455 per dollar compared to 1,457 at the end of last week.
The News Chronicle gathered that the rise in reserves is closely linked to stronger FX inflows recorded in October—Nigeria’s best month since May—driven by improved investor sentiment and a more stable macroeconomic environment.
Eurobond inflows and increased foreign participation in the securities market have helped lift confidence and strengthen Nigeria’s financial buffers.
Market analysts say the country’s investment climate is benefiting from wider interest rate differentials created by the US Federal Reserve’s easing cycle.
According to analysts at FBNQuest, high domestic interest rates are attracting offshore investors searching for superior returns, especially in fixed-income instruments. This carry-trade trend has been a major contributor to the influx of foreign funds.
Recent data from FMDQ shows FX inflows rose by 91 percent month-on-month to 6.1 billion dollars, with foreign investors accounting for over half of that volume.
Investments in fixed-income securities alone contributed 3.4 billion dollars, reflecting the sustained appetite for Nigeria’s high-yield offerings. Retail participation also improved sharply as individual FX contributions rose to 602 million dollars.
Nigeria’s recent Eurobond issuance, which was oversubscribed by 400 percent, further underscores the depth of investor confidence. The country also received a positive ratings outlook from S&P Global, which upgraded Nigeria from stable to positive.
However, the outlook for long-term investment remains mixed. Foreign Direct Investment slid by 25 percent to 222 million dollars, signaling continuing structural challenges, including security concerns and policy uncertainty.
Despite these concerns, the FX market continues to attract strong inflows, supported by the rare stability of the naira and consistent moderation in inflation, which eased to 16.1 percent in October. Economists believe these conditions could encourage further policy easing in the coming months.
