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Nigeria’s external reserves have risen to $40.2 billion as of October 18, 2024, according to the Central Bank of Nigeria (CBN). CBN’s Deputy Governor for Economic Policy, Mr. Muhammed Andullahi, announced the update during a briefing with foreign investors at the annual IMF and World Bank meetings in Washington, DC.
Andullahi highlighted that the current reserve level could sustain 14.5 months of imports covering both goods and services, or 18 months of goods-only imports. He further reported that foreign exchange inflows into Nigeria had reached $57 billion by August 2024, with capital importation nearly doubling to $6.9 billion, up from $3.9 billion in 2023.
The Deputy Governor also noted positive trends in diaspora remittances, now at a record $3.5 billion for the year as of August, compared to $3.2 billion in 2023. Monthly diaspora remittances have grown to $650 million, as the CBN continues to target a monthly inflow of $1 billion.
Additionally, CBN’s interventions in the foreign exchange (FX) market have decreased, now constituting only 5% of market turnover. Andullahi clarified that the CBN would intervene selectively to avoid market dependency on these actions. In December, the FX market is expected to adopt a matching system that will increase transparency, allowing participants to view transaction details in real-time.
Reflecting on Nigeria’s FX market history, Andullahi explained that long-standing issues in the market have contributed to current challenges. In response, CBN Governor Mr. Olayemi Cardoso assured investors that recent FX policy measures would facilitate smoother foreign exchange inflows for Nigerians and international investors.
Cardoso commented on the strengthened local currency, noting that rising interest rates could boost interest in domestic investments. He added, “As the naira strengthens, Nigerians are increasingly looking to local production options, which in turn reduces reliance on imported goods—a positive development for the economy.”
Addressing exchange rate unification, Cardoso explained that Nigerian diaspora members now have a streamlined process to send remittances, reducing reliance on informal channels and contributing to higher inflow levels from abroad.
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