Nigeria’s foreign exchange reserves have recorded their first decline in nearly six months, falling by $263.15 million to $45.21 billion as of December 17, 2025, according to figures released by the Central Bank of Nigeria (CBN). The drop brings an end to a 25-week streak of steady reserve accumulation that had lifted external buffers to their strongest level in six years.
The decline followed three consecutive days of outflows between December 15 and 17, reversing gains that had pushed reserves to a peak of $45.47 billion on December 12. By December 17, the reserve position had eased to $45.21 billion, signaling renewed pressure on Nigeria’s external accounts.
The setback comes despite strong reserve growth earlier in the year. CBN data show that gross reserves rose by about $1.5 billion month-on-month to $44.7 billion at the end of November. Between January and November, reserves increased by $3.8 billion, while gains since June totaled roughly $7.5 billion. A major contributor was Nigeria’s $2.4 billion Eurobond issuance in November, part of which was used to refinance a maturing $1.2 billion bond.
Before the December pullback, Nigeria’s reserves were providing solid import cover, estimated at nearly 14 months for merchandise imports and over nine months when services are included, based on balance-of-payments data up to March 2025.
Analysts attribute the recent decline to a combination of weaker foreign inflows, heightened seasonal demand for dollars, and significant debt repayments. Foreign exchange inflows dropped sharply in November, falling by about 67 percent to $2.0 billion, the lowest level since mid-2024. Portfolio investment inflows declined steeply, while foreign direct investment fell to minimal levels, developments that increased pressure on the naira. Market watchers have linked the slowdown partly to investor concerns surrounding capital gains tax policy.
In addition, the CBN settled substantial obligations in mid-December, including repayments on primary market instruments and matured open market operations (OMO), totaling more than ₦640 billion. Although the apex bank also conducted fresh OMO sales exceeding ₦1.3 trillion earlier in the month, analysts say the timing of repayments may have weighed on reserve levels.
Seasonal factors also played a role, as demand for foreign currency typically rises toward year-end due to holiday travel, import payments, and retail stockpiling. These pressures emerged even as reserves remained relatively strong, contributing to mild depreciation in the naira.
Despite the recent decline, Nigeria’s external buffers remain well above levels recorded in previous years, including $40.19 billion at the end of 2024 and $33.22 billion in 2023. However, analysts caution that sustained weak inflows or heavier repayment schedules could challenge currency stability if pressures persist.
Looking ahead, economists expect festive-season demand to continue influencing the foreign exchange market in the near term, with possible spillover effects on inflation. Still, stronger reserve levels, diaspora remittances, and proceeds from recent Eurobond issuances are expected to provide some support, helping the CBN manage liquidity and limit volatility as the country moves into early 2026.
