Nigeria’s external reserves have experienced their initial drop after a prolonged 25-week upward trend, decreasing by $263.151 million—or about N381.569 billion—to reach $45.21 billion as of December 17, 2025, based on the latest figures from the Central Bank of Nigeria (CBN).
This reduction, which occurred over three straight days of outflows from December 15 to 17, represents a shift away from the extended buildup that had elevated the reserves to a six-year peak.
The downturn concluded a consistent accumulation phase that topped out at $45.472 billion on December 12. By December 17, the level had declined to $45.209 billion, indicating fresh strains on the nation’s foreign financial standing.
Insights from the Figures This setback arrives even after substantial increases earlier in the year. According to CBN statistics, the country’s total official reserves climbed by $1.5 billion from the previous month to $44.7 billion by the close of November 2025.
In the first 11 months leading up to November, the reserves expanded by $3.8 billion, with a $7.5 billion surge since June, when they hit their lowest point for the year so far. A major contributor was the $2.4 billion Eurobond launch in November, which helped refinance a $1.2 billion maturing Eurobond.
Prior to the December slide, Nigeria’s reserves were solid, offering coverage for 13.9 months of goods imports and 9.4 months including services, as per the balance of payments data through March 2025.
Factors Behind the Change: Diminished Inflows, Elevated Demand, and Substantial Debt Settlements Incoming foreign currency dropped sharply by 67% from the prior month to $2.0 billion in November, marking the lowest since July 2024. Investments from abroad in portfolios plummeted to $593 million from $3.5 billion, and direct foreign investments shrank to $10.4 million from $221 million, adding more stress to the naira. Experts attribute these shifts to the debated Capital Gains Tax (CGT).
Moreover, the CBN handled various commitments from December 15 to 18, including repayments in the primary market of:
N9.103 billion, N22.327 billion, N70.857 billion, and N537.750 billion for maturing Open Market Operations (OMO) on December 16, amounting to N640.037 billion in total debt obligations, likely sourced from the reserve pool. Concurrently, the CBN issued new OMO auctions worth N408 billion and N916.200 billion on December 11, summing up to N1.324 trillion, which might have balanced out the repayments.
Holiday-Related Currency Pressures Similar to past seasons, demands for foreign exchange spiked due to vacation trips, import payments, and inventory buildup for retailers. Even with bolstered reserves in November, the naira saw a slight depreciation amid these mounting forces.
That said, Nigeria’s reserve holdings are still much stronger than the $40.19 billion at the end of 2024 and $33.22 billion in 2023. However, the timing of this dip highlights ongoing vulnerabilities, particularly with rising FX needs and stricter international financial climates.
The reserves still ensure ample import coverage, though experts caution that extended low inflows or increased repayments might undermine the naira’s steadiness.
Future Prospects: Holiday Strains, Remittance Support on the Horizon Analysts at FBNQuest anticipate additional pressures on the naira during the festive period, coupled with possible inflation spikes from import-driven consumer activity. With the naira hovering near N1,455 per dollar in late 2025, year-end demands could heighten temporary fluctuations.
On the positive side, enhanced reserves, inflows from overseas Nigerians, and the latest Eurobond proceeds are projected to support the currency and aid the CBN in handling liquidity.
Investor confidence could stay guarded, potentially leading to brief sell-offs in stocks and a more constrained financial landscape as FX demands peak heading into 2026.
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