Nigeria’s external reserves have continued their upward trajectory, rising to $49.34 billion as the naira remained largely stable against the United States dollar, reinforcing investor confidence in the country’s foreign exchange market reforms and external sector outlook, according to the latest data released by the Central Bank of Nigeria (CBN).

This is just as the apex bank revealed that Nigeria spent approximately $2.34 billion on food imports in 2025, underscoring the country’s continued dependence on foreign food supplies despite a modest decline in foreign-exchange demand for food imports.

The latest report released by the CBN showed that the nation’s gross official foreign reserves increased by $359.84 million week-on-week, climbing from $48.98 billion recorded at the close of the previous week to $49.34 billion as of May 26, 2026.

The sustained growth in reserves reflected improving external liquidity conditions and underscored the gains from recent efforts by monetary authorities to strengthen foreign exchange market stability.

Analysts attributed the increase largely to steady inflows from crude oil exports, supported by relatively stable production levels and improved earnings from Nigeria’s oil sector.

The development, they noted, has continued to bolster the country’s external buffers and enhance its ability to meet international obligations.

The latest Increase in reserves comes at a time when the CBN is intensifying reforms aimed at deepening liquidity in the foreign exchange market, narrowing exchange rate distortions and improving investor confidence.

Market operators said the growing reserves position provides a stronger cushion against external shocks while supporting the apex bank’s capacity to manage market pressures and sustain confidence in the naira.

At the foreign exchange market, the domestic currency recorded a modest gain against the dollar during the review period.

Data from the Nigerian Foreign Exchange Market (NFEM) indicated that the naira appreciated by 0.16 per cent week-on-week, strengthening by N2.20 to close at N1,373.25 per dollar compared with N1,375.45 per dollar recorded a week earlier.

The currency also traded within a relatively narrow band against the dollar, between N1,372 and N1,377, suggesting reduced volatility and improved market equilibrium.

The stability observed in the foreign exchange market has been linked to increased dollar supply, enhanced market transparency, and sustained interventions to support orderly trading conditions.

Analysts said the combination of rising reserves and relative exchange rate stability signals growing resilience in Nigeria’s external sector, although they cautioned that challenges remain.

According to them, foreign-exchange demand pressures, fluctuations in global oil prices, and potential portfolio investment outflows stemming from uncertainties in the international financial environment could still pose risks to the market in the months ahead.

Nevertheless, they expressed optimism that the naira would remain broadly stable in the near term, supported by stronger reserve buffers, improving market liquidity and continued foreign exchange inflows.

The latest reserve accretion is also expected to strengthen Nigeria’s import cover, improve the country’s capacity to meet external obligations, and provide additional support for broader macroeconomic stability as policymakers continue efforts to attract foreign capital and consolidate confidence in the economy.

With reserves approaching the $50 billion mark and exchange rate volatility moderating, analysts believe Nigeria’s external sector is showing signs of gradual strengthening, offering a measure of reassurance to investors and businesses navigating an increasingly uncertain global economic landscape.

CBN: $2.34bn Spent on Food Imports in 2025 Despite Decline in Forex Demand

Meanwhile, Nigeria spent approximately $2.34 billion on food imports in 2025, according to the latest data released by the CBN.

Figures contained in the apex bank’s Quarterly Statistical Bulletin, quoted by Nairametrics yesterday, showed that food import expenditure fell by 7.37 per cent from the $2.53 billion recorded in 2024, suggesting a moderation in demand for imported food products amid efforts to boost domestic agricultural production and improve food security.

The data, however, revealed that food imports continued to exert significant pressure on the nation’s foreign exchange resources, with an average monthly utilisation of $195.28 million throughout the year.

A breakdown of the figures showed that food importers utilised $213.11 million in January, $195.68 million in February, $141.30 million in March, and $141.13 million in April.

The figure rose to $202.83 million in May before easing to $171.08 million in June.

Demand strengthened in the second half of the year as foreign exchange utilised for food imports climbed to $229.70 million in July, moderated to $175.55 million in August, and surged to $248.60 million in September, the year’s highest monthly level.

Food importers also accessed $193.05 million in October, $185.45 million in November, and $245.86 million in December, reflecting sustained demand for imported food products despite foreign exchange market reforms and efforts to encourage local production. (THISDAY)

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