Nigeria’s foreign reserves have risen to their highest level in more than a decade, offering a rare moment of financial relief for Africa’s largest economy amid years of foreign exchange pressures and currency instability.

According to figures released by the Central Bank of Nigeria on March 3, the country’s gross external reserves reached $50.45 billion as of February 16, 2026. The milestone marks the strongest reserve position recorded in 13 years, signalling improved foreign currency buffers and increased capacity to manage external financial obligations.

External reserves serve as a critical financial safeguard for any economy. They help countries finance imports, service foreign debt, and intervene in currency markets when volatility threatens stability. At its current level, Nigeria’s reserves are estimated to cover 9.68 months of imports of goods and services, meaning the country could theoretically sustain nearly ten months of import demand even if foreign inflows were to slow.

Data from the central bank also show improvement in the country’s net reserve position, which rose to $34.80 billion in December 2025, up from $23.11 billion in December 2024. Over the course of 2025, gross reserves increased from $40.19 billion to $45.71 billion, before continuing their upward trajectory into early 2026.

Governor of the Central Bank of Nigeria, Olayemi Cardoso, said the buildup strengthens the country’s ability to meet external commitments while providing greater flexibility to stabilise the foreign exchange market when necessary.

The reserve growth comes amid sweeping economic reforms introduced by the administration of Bola Ahmed Tinubu, particularly changes to Nigeria’s foreign exchange framework. In 2023, the government moved to liberalise the exchange rate system, allowing the naira to trade more freely after years of operating under multiple exchange windows.

That transition initially triggered a sharp depreciation of the local currency as pent up demand for foreign exchange resurfaced in the market. However, more recent data suggest signs of gradual stabilisation.

Figures from XE Converter indicate that the naira strengthened modestly over the past year, moving from about ₦1,499.38 per dollar in March 2025 to ₦1,359.34 per dollar by March 2026.

Inflationary pressures have also shown signs of easing. Nigeria’s consumer price inflation slowed to 15.10 percent in January 2026, the lowest level recorded since the inflation surge that peaked at 34.19 percent in June 2024, which had been driven by currency depreciation, fuel subsidy removal and rising food prices.

Cardoso noted that recent economic indicators suggest the ongoing monetary and exchange rate adjustments are beginning to yield results. According to him, the central bank will continue to maintain “adequate buffers” within the country’s reserves while supporting orderly operations in the foreign exchange market and sustaining broader macroeconomic stability.

For now, the latest figures offer a measure of breathing space for the Nigerian economy. Analysts say sustaining the momentum will depend largely on continued foreign capital inflows, stable oil export earnings, and consistent currency market reforms in the months ahead. (Arise News)

Update news