- Nigeria’s external reserves have dropped as Middle East tensions triggered capital flight
- Data shows that the reserves, which rose to a high of $50 billion, have now dropped
- Analysts have warned that reserves may remain under pressure unless FX inflows improve
The Central Bank of Nigeria (CBN) has revealed that external reserves have dropped to $49.57 billion as of March 24, 2026, from a recent peak of $50.02 billion recorded on March 11, 2026.
In the last seven consecutive sessions, data from the CBN shows that reserves have dropped.
Photo: CBN
Source: Facebook
BusinessDay reports that the sustained decline underscores the growing impact of capital outflows and structural challenges facing the country’s foreign exchange earnings.
External pressures widen the current account gap
Nigeria’s current account surplus narrowed in 2025, reflecting rising external pressures.
Provisional balance of payments data published by the CBN showed the surplus fell to $14.04 billion in 2025 from $19.03 billion in 2024, though it remained above the $6.42 billion recorded in 2023.
According to the CBN, rising outflows weighed on the current account position.
The services deficit widened to $14.58 billion from $13.36 billion, driven by higher payments for transport, travel, insurance, and government services.
Net outflows in the primary income account surged by 60.88% to $9.09 billion, reflecting increased dividend and interest payments to foreign investors.
The secondary income account, which captures remittances and official transfers, declined to $23.20 billion from $24.88 billion, as inflows from both official development assistance and personal transfers weakened.
Nonetheless, diaspora remittances remained a critical source of foreign exchange support for the economy.
Expert speaks
Ayodele Akinwunmi, Chief Economist at United Capital Plc, said Nigeria’s foreign reserves, measured on a 30-day moving average, have declined as higher oil prices have not translated into sufficient foreign exchange inflows to meet demand.
He added that global uncertainty tied to the Middle East crisis has triggered a flight to safety from emerging markets, further weighing on reserves.
“Unless oil production improves and foreign capital returns, the reserves are likely to remain under pressure despite favourable oil prices,” he said.
Although geopolitical tensions have driven capital outflows from emerging markets globally, Nigeria has continued to record modest portfolio inflows, according to a report by the Financial Markets Dealers Association.
Photo: Bloomberg
Source: Getty Images
Mixed outlook for the naira
Ayodeji Ebo, Managing Director and Chief Business Officer at Optimus by Afrinvest, said higher oil revenues could help stabilise the naira by boosting foreign exchange inflows and strengthening reserves.
He cautioned, however, that persistent inflationary pressures and rising global risk aversion could still trigger capital outflows, potentially weakening the currency.
He added that volatility in the parallel market could widen exchange rate gaps, with implications for remittances and import costs.
New naira to dollar exchange rate in 2026
Earlier, Legit.ng reported that the naira is expected to trade within the N1,350 to N1,450 range against the US dollar in 2026.
This projection was presented by Yemi Kale, Chief Economist at the Africa Export-Import Bank (Afreximbank), during his keynote speech at the FirstBank Nigeria Economic Outlook 2026.
In his presentation, Kale provided scenario-based estimates for the USD/NGN exchange rate, factoring in variables such as oil prices, foreign exchange inflows, inflation patterns, and the consistency of economic policies.
Source: Legit.ng
