In a strong demonstration of its commitment to macroeconomic stability, the Central Bank of Nigeria (CBN) has ramped up foreign exchange inflows, attracting an average of $6 billion monthly since May 2025. This surge, largely attributed to bold reforms and enhanced investor participation, signals renewed confidence in Nigeria’s economic outlook.
Industry reports reveal that total FX inflows rose by 62% month-on-month in May 2025 to $5.96 billion—one of the highest in recent months. Analysts at Financial Derivatives Company Limited credited this rise to climbing global oil prices and the CBN’s diversified FX inflow channels.
The naira has shown signs of resilience, closing the week at N1,570/$ at the parallel market and N1,536/$ at the official window—leaving a relatively narrow gap of N34/$. The CBN has taken decisive steps to stabilize the naira and improve dollar access, including licensing new International Money Transfer Operators (IMTOs), promoting diaspora remittances, and enforcing a “willing buyer, willing seller” model.
Diaspora remittances, which currently average $23 billion annually, remain a dependable FX source. The CBN under Governor Olayemi Cardoso has introduced several innovations to double these inflows, such as launching diaspora-focused financial products and improving naira liquidity access for IMTOs.
Charlie Bird, Director of Trading at Verto, hailed the reforms during Cordros Asset Management’s seminar, The Naira Playbook, noting that improved dollar liquidity now allows foreign investors and airlines to repatriate funds with greater ease. “Nigeria has become a preferred destination for foreign investors,” he said.
In a strategic push to enhance transparency, the CBN recently issued revised guidelines for IMTOs and rolled out policies to improve formal remittance channels. These efforts include enabling licensed operators to access naira liquidity from the CBN to ensure swift disbursement of diaspora funds.
Net FX Reserves Soar to $23.11 Billion
Meanwhile, Nigeria’s net foreign exchange reserves (NFER) jumped to $23.11 billion at the close of 2024—the highest in over three years—up from $3.99 billion the previous year. Gross external reserves also climbed to $40.19 billion, reflecting the CBN’s deliberate efforts to reduce short-term liabilities and build long-term resilience.
Governor Cardoso, who assumed office in October 2023, has made rebuilding the nation’s economic buffers a top priority. “This improvement in our net reserves is not accidental; it is the outcome of deliberate policy choices aimed at rebuilding confidence, reducing vulnerabilities, and laying the foundation for long-term stability,” he said.
The CBN’s decision to unify Nigeria’s multiple exchange rates and clear over $7 billion in FX backlogs has reinvigorated investor confidence and created a more transparent market. An electronic FX matching system, modeled after global best practices, is also in the works to enhance efficiency.
Looking ahead, the apex bank expects continued reserve growth in Q2 2025, supported by improved oil production, rising non-oil exports, and sustained investor interest. These developments underscore the CBN’s strategic intent to stabilize the naira, attract capital, and position Nigeria’s economy on a path of sustainable growth.
With robust policy reforms, increased FX inflows, and strengthening reserves, the CBN is steadily achieving its goals of price and exchange rate stability. As confidence grows among investors and stakeholders, Nigeria’s economic prospects continue to brighten under the Cardoso-led monetary regime.
Comments